00:00 Speaker A
Hey Amazon, I think Jed is a stealth AI winner. Why? What do you think we underestimate about their AI strategy?
00:09 Jed
Well, the buzz on Amazon has been really negative all year around two specific things. For the first half of this year, all retailers will be forced to raise prices due to President Trump's tariffs. That means fewer sales for retailers and less advertising revenue for Amazon.
00:27 Jed
As a result, stock prices were very lagging in the first half of this year. And later this year, there were concerns that AWS wasn't growing as fast as GCP or Azure.
00:38 Jed
And that's a concern, and we think Amazon is losing market share. What actually happened was
00:43 Jed
Amazon was just slow to start building data centers at a very fast pace a year and a half ago. Amazon got the demand signal that AI was real and big a quarter or two later than Microsoft and Google.
00:56 Jed
Ah, but now Amazon has the demand signal. They are catching up and deploying capacity, and revenues will accelerate. And we saw a great earnings report in the third quarter.
1:08 Jed
Um, but now there's growing skepticism about this kind of AI, and stocks are struggling again. In other words, Amazon has suffered one blow after another throughout the year.
1:15 Jed
But looking to next year, AWS growth is expected to exceed 20%. Retail growth has been in the double digits, the highest growth rate of all large-format retailers in the United States.
1:21 Jed
Therefore, I expect the stock to perform well and emerge as an AI winner.
