Morgan Stanley Bullish on Amazon's AI Growth Potential: AWS Could Become a Trillion-Dollar Business

Odaily News Morgan Stanley stated that if Amazon's cloud computing business AWS accelerates its growth further, the company's stock price could reach $500 by the end of 2027, nearly doubling from current levels.

Morgan Stanley's optimistic scenario is based on AWS's potential to develop into a business with annual revenue reaching $1 trillion, driven primarily by growing demand for AI computing power and data center expansion. As competition in AI infrastructure intensifies, Amazon is significantly increasing its AI-related investments. The company recently raised its AI capital expenditure forecast for 2026 to $220 billion, focusing on expanding cloud computing infrastructure, AI computing power, and data center capabilities.

Morgan Stanley believes AWS will continue to play a core role in the AI wave. As enterprises accelerate their adoption of generative AI services, demand for cloud computing and inference computing power could further drive AWS revenue growth.

However, Morgan Stanley currently maintains its base target price for Amazon at $335, representing approximately 28% upside from the current stock price. The $500 target price falls under a more optimistic scenario, contingent on whether AWS can achieve faster growth and fully capture opportunities in the AI infrastructure market.