Abu Dhabi, United Arab Emirates: Amazon enters its fourth-quarter earnings season with improved investor confidence, buoyed by a strong performance in the previous quarter and growing optimism about its cloud computing arm, Amazon Web Services (AWS).

The momentum of cloud computing was a major driver of positive sentiment, with AWS growth exceeding expectations, and clear indications of continued strong demand in parallel with expanding capacity .

Commenting on the outlook, Lale Akuner, global markets analyst, said : “The momentum in AWS has been a key positive for Amazon, with cloud computing growth exceeding expectations and demand remaining strong as capacity expanded. This has played a significant role in boosting investor confidence ahead of the fourth quarter .”

Looking ahead, 2026 is expected to be a pivotal year for AWS , particularly as AI-related workloads continue to expand. Investors are increasingly focused on whether the accelerated growth of cloud computing can translate into stronger earnings momentum and support a higher stock valuation. At current levels, Amazon shares are trading at a relatively modest multiple of their long-term earnings, which is also contributing to improved sentiment .

In addition to cloud computing, the market is also focused on Amazon’s path to higher profitability, including the potential for expanding operating margins, continued capital expenditure discipline, and sustained growth in its advertising business .

In the longer term, further upward momentum may come from the automation of logistics, the expansion of AI monetization across consumer products, new revenue streams such as satellite internet, and the potential for future increases in Prime subscription prices.

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