12 Best FAANG+ Stocks to Invest in Right Now

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5. Amazon.com Inc. (NASDAQ:AMZN)

Number of hedge funds: 286

Amazon.com Inc. (NASDAQ:AMZN) is involved in retail e-commerce, content subscription services (Prime Video), advertising, and cloud computing. The company’s product offerings through its online and offline stores include merchandise and media content acquired for resale, as well as products from third-party sellers. Additionally, Amazon.com Inc. (NASDAQ:AMZN) operates one of the largest data center networks globally through its Amazon Web Services (AWS) division. AWS provides a comprehensive suite of cloud services, including computing power, storage options, and networking capabilities, catering to a diverse range of customers from startups to large enterprises.

AWS has been a significant driver of earnings growth for Amazon.com Inc. (NASDAQ:AMZN), contributing around 60% of the total operating profit while accounting for just 17% of total revenue. With the increasing demand for cloud services and digital transformation across industries, AWS is expected to remain the company’s growth engine for many years to come. The robust profitability and cash flows from AWS also enable the company to fund its expansion, particularly in its fulfillment centers. The International and North American e-commerce businesses demonstrate strong operating leverage and have the potential to improve profits in the coming years.

Amazon.com Inc. (NASDAQ:AMZN) is making significant advancements in AI, not just by enhancing its existing offerings, but also by investing in custom silicon chips like Trainium for training and Inferentia for inference. During its Q3 2024 earnings call, management indicated that the total capital expenditure for 2024 is projected to be around $75 billion, with the majority allocated to technology infrastructure and meeting AI-driven demand. The company anticipates increasing its investment even further in 2025.

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