00:00 Speaker A
Amazon, you say, Jed, a stealth AI winner. How come? What what are we all maybe underestimating in your opinion about their AI strategy?
00:09 Jed
Yeah, the talk on Amazon has been negative really all year related to two specific things. First half of the year it was uh Trump’s tariffs are going to make everybody at retail raise their prices, which means they’re going to sell less and Amazon’s going to be able to make less advertising money off of that.
00:27 Jed
So the stock really lagged first half of the year. Then the second half of the year, the concern was AWS is not growing as fast as GCP and Azure.
00:38 Jed
And that’s a concern and we think we think Amazon’s losing market share. When in reality what’s happened is,
00:43 Jed
Amazon was just slower to start building data centers at a really fast pace a year and a half ago. Amazon got those demand signals that AI was real and huge, a quarter or two after Microsoft and Google.
00:56 Jed
Uh but now, you know, Amazon has those demand signals. They are catching up, they’re rolling out capacity and their revenues are are going to accelerate. And we saw that in the third quarter, they reported a an excellent earnings report.
1:08 Jed
Um but now we’ve got this kind of AI skepticism building in and the stock has struggled again. So it’s just been kind of one stubbed toe after another for Amazon all year.
1:15 Jed
But as I look out to next year, I see north of 20% growth from AWS. I see double digit growth from retail, fastest growth rate in in all of large cap US retail.
1:21 Jed
So I expect the stock to to do well and emerge as an AI winner.