Shares of Amazon.com, Inc. (NASDAQ:AMZN) are trending Wednesday after the Seattle-based e-commerce company confirmed plans to imminently lay-off 16,000 workers. Multiple analysts also weighed in on the stock following the company’s updated grocery strategy.
- Amazon.com stock is showing positive momentum. What’s the outlook for AMZN shares?
Whole Foods Market Expansion
Amazon recently announced the closure of 58 Amazon Fresh stores and 14 Go stores, plus added investment into its Whole Foods Market brand. A note published this week by Wedbush analysts said the company’s move to open 100 new stores in the next few years will help it capture “incremental market share” in perishable categories where it has historically struggled.
Ultimately, Wedbush expects the moves to increase the value of Prime memberships and put pressure on competitors. Wedbush has an Outperform rating on Amazon stock with a 12-month price target of $340.
Bank of America analysts also noted that Amazon has much of the “temperature-controlled infrastructure needed for perishable delivery” already built, and that the conversions of some Fresh/Go locations into Whole Foods Market stores will minimize added capital expenditures.
“While Amazon will continue to test new store formats, we believe today’s announcement signals growing confidence in Amazon’s current strategy and opportunity for category growth. As Amazon improves grocery capabilities over time, we also expect gains in customer frequency and a lock-in not achievable in other verticals,” BofA said in a note to clients.
Artificial Intelligence Continues To Drive Competition
Ahead of fourth-quarter earnings next week, KeyBanc analysts raised their revenue estimates for the next three fiscal years, citing growth in the retail and cloud segments. The firm also expects fourth-quarter revenue to come in slightly ahead of the consensus estimate of $211.8 billion.
The strength of the cloud segment comes from more computational power coming online and the company’s partnerships with AI companies. Keybanc noted that AI company Anthropic paid inference costs of $2.7 billion in 2025, which is up around $500M from mid-year projections and up from $719M in 2024.
The note also pointed out Amazon’s retail resilience against Google Shopping as an indicator that agentic AI will not pose a significant challenge to unit economics.
“While we acknowledge this is an area that is evolving quickly, we believe Amazon’s capabilities are not easily disintermediated. We expect to see management frame Amazon’s advantages, and believe consistent retail growth can help allay concerns,” KeyBanc analysts said in a new note.
Amazon will report earnings for the fourth quarter after the market close on Feb. 5.
AMZN Stock Moves Lower
AMZN Price Action: Amazon shares were down 0.64% at $243.12 at the time of publication on Wednesday, according to Benzinga Pro data.
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