Citi raised its Amazon (NASDAQ: Price AMZN) price target from $265 to $285 on Wednesday, March 25 to maintain “Buy” rating.
Beyond the new price, the bank increased the estimate of Amazon Web Services (AWS), also mentioning artificial intelligence (AI) want to track the money that comes from it Anthropic, OpenAIand great works.
In fact, Citi now expects AWS revenue growth of 28% annually in Q1 and 29% in 2026 as a whole. In 2027, this number is expected to rise to 37%, as Amazon’s Anthropic and OpenAI partnerships evolve.
While acknowledging concerns about cash flow, competitive pressures, and the low visibility of free cash flow, the analysts said that fast cash flows, revenue growth, and rising operating costs support positive sentiment.
“… we believe that AWS can increase its development capacity (we are revising our CapEx projections slightly). While we acknowledge the concerns surrounding AWS ROI, competition, and the limited FCF structure, being quickly funded following capacity additions, accelerating revenue growth, and increasing OI, we believe that AWS is improving,” expert Ronald Josey wrote.
Amazon Web Services will drive future growth, Citi says
Additionally, Citi expects Anthropic to deliver approximately $18 billion and $31 billion in AWS in 2026 and 2027, respectively. Expectations are based on simulations, studies, and sales activities that are happening on AWS infrastructure such as Project Rainier scales.
When it comes to OpenAI, analysts pointed to AWS’s $100 billion, eight-year agreement with Trainium and the $38 billion, seven-year GPU agreement with Nvidia (NASDAQ: NVDA). As a result of these interconnected trends, Citi estimates that OpenAI could generate approximately $6 billion in AWS revenue in 2026 and approximately $18 billion in 2027.
Overall, the analysis confirmed that AI-related demand will make up about 58% of AWS’s additional revenue this year and about 72% next year. At the same time, AI adoption is accelerating new cloud migration and workloads, which should allow non-AI services to continue to grow.
Amazon’s best price
At the time of writing, Amazon’s target price for the next twelve months is $283.57. These predictions are the results of forty-four analysts covering the past ninety days, as shown by the market analysis platform. TipRanks.
Forty-four analysts believe Amazon is a “Buy,” while only three say it’s a “Hold.” Notably, there have been no “Sell” recommendations in the past three months, which puts Amazon on Wall Street’s “Strong Buy” list.
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