Amazon's Q3 Print Show AI Demand Exceeding Supply, Slowing Dollar Growth, BofA Securities Says

MT Newswires Live10-30 23:10

Amazon.com's (AMZN) Q3 print saw AI demand exceeding supply amid slowing sequential dollar growth, suggesting capacity limitations or client price adjustments impacted the quarter, BofA Securities said in a note Friday.

Management has projected Amazon Web Services will grow 40% in both 2027 and 2028, with the backlog rising $82 billion quarter-on-quarter, which should help investors look past the slowing sequential dollar growth, according to the note.

BofA said it expects AWS to continue to accelerate and projects Q4 revenue to be at the high end of the company's guidance of $240 billion and $247 billion, but maintained its EBIT estimate at $33.5 billion.

For 2027, BofA raised its revenue and earnings per share estimates to $968 billion and $10.60, from $961 billion and $10.24, respectively. Capex estimates for 2027 also go up to $310 billion from $302 billion previously.

BofA Securities lowered its price target to $317 from $320, and maintained its buy rating on the stock.

Price: 239.47, Change: -4.32, Percent Change: -1.77

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