Amazon says increased pressure from rivals is draining some of the stock’s appeal

Amazon’s cloud-computing business has pushed its shares higher for almost two decades, but the company said increased pressure from rivals is draining some of the stock’s appeal. AMZN is currently trading at $220.34, down 2.175% over the last 30 days but up 13.54% over the last 6 months.

AMZN stock is roughly 9% from its all-time high of $242 a share. The stock has also rebounded by 15% over the last six months, but remains the worst performer among its Mag 7 big tech peers.

Amazon reports positive growth with cloud computing

Just a friendly reminder that $AMZN is currently priced for 17% AWS growth.

What happens when the largest hyperscaler in the world does this? pic.twitter.com/13EVyqaD17

— Sam Badawi (@samsolid57) September 28, 2025

The rise of artificial intelligence has led to a surge in demand for cloud hyperscalers, with Amazon Web Services (AWS) having the biggest market share. Amazon has also incorporated AI into nearly every facet of its business, including the integration of generative AI into Alexa, Amazon One, and Amazon Bedrock, which enables developers to access top-tier machine learning models via a single API.

AWS accounts for an estimated 30-33% of the global cloud infrastructure market in Q2 2025. The division also contributed to the company’s $30.9 billion in revenue in Q2 2025, representing a 175% year-over-year increase. AWS’s robust operating margin of 35.5% in Q2 2024 outpaces Amazon’s overall profitability.

Amazon noted that its growth rate was slightly below the 20% consensus, which signaled encroaching competition. The firm is also investing over $100 billion in 2025, primarily to enhance its AI infrastructure with new foundation models, such as Amazon Nova.

Microsoft Azure reported a 39% increase in revenue for its fiscal fourth quarter (ended June 2025). The tech firm also reported $75 billion in revenue during the same period, largely attributed to Microsoft’s AI strategy. 

Microsoft has also partnered with OpenAI to integrate AI capabilities into Azure’s offerings seamlessly. Azure reported a 20-24% market share in Q2 2025, and is already leveraging its cloud solutions to chip away at AWS’s lead. Microsoft is also planning to invest over $30 billion in Q1 2026 to further strengthen its cloud infrastructure in response to the escalating demand for AI.

Google Cloud also reported significant growth, with a 32% year-on-year surge in revenue to $13.6 billion in Q2 2025. The company’s operating income increased by 142% to $2.18 billion in Q1 2025, despite growth being constrained at times by data center capacity.

Google’s parent company, Alphabet, is also investing close to $85 billion to boost data center capacity. Google Cloud accounted for 11-13% of the market share in Q2 2025, with a focus on Tensor Processing Units (TPUs) for AI workloads and a strong emphasis on data analytics and open-source tools, which has some appeal to its stock.

Cryptopolitan previously reported that Amazon reached a $2.5 billion settlement with the Federal Trade Commission (FTC) over Prime membership practices. The initiative removed a significant regulatory overhang on the tech firm and led to a brief surge in its stock.

Zacks Investment Research brokers appear to be bullish on AMZN’s outlook and AI endeavors. Zacks Rank shows that AMZN has an average brokerage recommendation (ABR) of 1.14 on a scale of 1 to 5 (Strong Buy to Strong Sell). 

Tech companies bet big on computing resources

Hyperscalers are increasing their capital expenditures due to the increase in demand for scalable, high-performance computing resources to train and deploy AI models. Semiconductor companies like Nvidia and Intel are direct beneficiaries as the demand for specialized AI chips rises.

Amazon announced on Monday that it has committed $1.9 billion to the Delivery Service Partner (DSP) program. The firm’s latest initiative brings its total investment in the DSP program to $16.7 billion.

Needham analyst Laura Martin also argued that Amazon’s Ad division is key to funding the firm’s future growth. The research company found that the Ad business contributes over half of its total operating income. Martin called Amazon’s Ad business its crown jewel, saying it will be a more important source of growth than Amazon Web Services or e-commerce in the near term.

Get seen where it counts. Advertise in Cryptopolitan Research and reach crypto’s sharpest investors and builders.