Amazon is scheduled to report first-quarter results on Wednesday, and investors will be watching to see whether the company’s AI investments are paying off.
Wall Street will likely focus most of its attention on one part of the company’s business: Amazon Web Services, Amazon’s biggest source of revenue.
The company aims to leverage AI to improve the AWS user experience, create software, and improve data storage, and is expected to spend $200 billion on AI projects such as data centers and chip development in 2026.
Investors will want to see progress in AWS’s revenue growth to prove that all the cash poured into building AI is delivering meaningful returns. AWS revenue in Q4 2025 increased 24% year over year.
The stock has had a great month, up 29% over the past 30 days. Shares are up 14% year-to-date, trading at about $260 per share.
Analysts expect net sales to be $177.23 billion and earnings per share to be $1.62.
Here’s what Wall Street analysts say to watch out for when the company makes its announcement Wednesday afternoon.
RBC Capital Markets
The bank said AWS revenue will be a key indicator to watch as investors look for clues that all of Amazon’s AI spending is paying off.
“The Q1 2026 print will be critical to proving whether AWS can deliver enough acceleration to validate the $200 billion capex guidance, which exceeded all street expectations, analyst Brad Erickson wrote in a client note on Monday.” Erickson said Amazon bulls expect AWS revenue to grow at least 30% year-over-year.
RBC gives the stock an “outperform” rating and a price target of $300 per share, suggesting 15% upside potential.
UBS
UBS is very bullish on AWS, saying it expects Amazon’s cloud business to announce strong revenue growth of 38%.
“The most meaningful continued divergence relative to the Street is in AWS revenue growth in 2026, which currently stands at 38% (versus 26% vs. the Street) and then increases further in 2027,” analyst Stephen Ju wrote in an April 23 note. “Therefore, our 2027 operating profit forecast is ~39% higher than consensus and we continue to believe the Street will catch up to current levels.”
The bank has given the stock a “buy” rating and a price target of $304 per share.
bank of america
Analyst Justin Post expects AWS to grow 28% and said CEO Andy Jassy’s comments on AI will drive the stock price.
One notable statistic, he said, is AWS’s quarter-over-quarter profit margin growth.
“In our view, this quarter will highlight strong demand for AWS and its improved technology position relative to peers,” Post said in a recent note to clients, adding, “However, weaker AWS sequential incremental margins could resurface concerns about capital investment returns.”
Post also noted that Microsoft and Alphabet will also report earnings on Wednesday, so investors will likely compare the tech giants’ performance against each other.
BofA rates the stock a “buy” and has a “price target” of $298.
morgan stanley
The bank expects AWS revenue growth to be in the range of 29% to 31%, with continued year-over-year growth of around 30% for the remainder of 2026.
Morgan Stanley rates the stock “overweight” and has a price target of $300.
Mizuho Americas
Analyst Lloyd Walmsley said investors should be wary of a decline in operating profit due to higher fuel costs, but they could dismiss it as a temporary cost increase.
Otherwise, he expects recent upbeat comments on AI in the company’s quarterly shareholder letter, rising CPU demand, and a sharp rise in Magnificent Seven stock’s valuation to fuel further upside.
“We are raising our AMZN target to $325 (from $315), which is primarily aimed at multiple expansions in our peer group,” Walmsley wrote in the note.