Where Will Amazon Stock Be In 5 Years?
April 9, 2025
Blink and you could miss the latest trend in Amazon’s stock price. Under an onslaught of conflicting tariff news, investors are wavering between bear and bull outlooks on the e-commerce giant. It’s the worst kind of thrill ride, with real money on the line.
Wondering how Amazon will fare in Trump’s second term and beyond? Here’s a look at the factors affecting AMZN stock’s growth outlook over the next five years. Spoiler alert: The U.S. tariff policy is a key theme.
Examining Amazon’s Current State
Amazon has a diversified business model that includes retail sales, cloud computing, digital advertising and streaming entertainment. Amazon.com is the most visited shopping website in the world, accounting for nearly 13% of desktop visits, according to Statista. Statista also reports that Amazon’s cloud offering, AWS, has a leading 30% market share, ahead of Microsoft’s Azure and Google Cloud. As well, Amazon Prime Video is atop the U.S. streaming market with a 22% market share, according to Evoca.tv.
Amazon stock is up 81% over the past five years, averaging 16.2% annually. Like many tech stocks, the growth trajectory has not been linear. 2022 was a negative year, followed by two growth years in 2023 and 2024. 2025 began strong, but tariff announcements from the U.S. government and the subsequent global economic fallout drove AMZN down about 20% since February 1.
Factors Impacting Amazon’s Future Outlook
Amazon has positive and negative forces in play over the next five years. The company’s growing advertising business, e-commerce dominance and AI offerings could drive improved performance. Challenges include the threat of global recession and a looming antitrust lawsuit.
Advertising
Amazon’s advertising business produced $17.3 billion in revenue in the fourth quarter of 2024, 18% more than the prior year period. The annual run rate has doubled in four years, as sellers invest in sponsoring their products on Amazon’s e-commerce platform. The company also launched streaming video ads on Amazon Prime last year.
With the addition of streaming ads, Amazon can deliver messaging at multiple points within a customer’s decision-making process—from brand awareness ads on Prime to conversion ads on Amazon.com. The company also offers robust data analytics so customers can understand how each channel contributes to overall sales.
E-Commerce Moat
Other e-commerce sellers cannot meaningfully compete against Amazon’s dominance. The company’s global scale, reach and brand recognition will deliver a long-lasting stream of shoppers to Amazon’s digital properties. This supports ongoing revenue from retail sales, Prime memberships, product ads and, indirectly, Prime video ads.
Amazon’s ongoing investment in automation and robotics for faster, cheaper order fulfillment should widen its competitive advantage.
AI Software And Hardware
AWS has grown recently as business customers move to cloud-based computing, in part to take advantage of generative AI technologies. AWS continues to expand its AI toolset to support that transition. The company has also launched an AI chip, Trainium2, and announced development plans for a supercomputer for AI training and computations.
The company’s investment in AI development tools and hardware will continue as long as demand remains strong. During the company’s fourth-quarter earnings webcast, President and CEO Andrew Jassy described AI as “the biggest opportunity since cloud and probably the biggest technology shift and opportunity in business since the internet.”
Global Recession
Threats of global recession and stagflation in the U.S. are weighing heavily on investors since President Trump announced worldwide tariffs on April 2. A wide-scale economic downturn would hurt Amazon across multiple areas of its business.
The good news is that Amazon has managed through a global financial crisis before. AMZN stock dipped more than 40% near the end of 2008 but then reversed those losses by mid-2009.
Given its size and financial strength, Amazon will survive an economic downturn better than most. Additionally, the 2025 stock price decline has reduced the valuation and risk. There may be more declines ahead, but it helps that some uncertainty is already priced in.
Regulatory Actions
In 2023, the FTC under the Biden administration sued Amazon for illegal actions to stifle competition. The trial had been slated to begin in September, but the FTC recently asked a judge for a delay due to resource constraints.
Experts disagree on Trump’s potential handling of this case. On the one hand, Trump may push the FTC to drop the charges because they were initiated under his predecessor. On the other hand, Trump has not backed down from other antitrust cases against big tech.
Analyst And Investor Sentiments
Amazon retains an average strong buy recommendation from analysts, according to Stockanalysis.com. There are 25 strong buys, 19 buys and one hold.
The consensus price target is $260.89, 40% higher than AMZN’s current price. This includes price target reductions initiated since the April 2 tariff announcement by analysts at Mizuho, Bank of America Securities, and JP Morgan. The cuts ranged from 10% to 18%.
Investors, too, believe the high U.S. tariffs undermine Amazon’s growth outlook. AMZN stock is down about 14% for the year, a decline prompted by Trump’s initial tariffs on Canada, Mexico and China announced in February. After the more extensive April 2 tariff announcement, AMZN’s price dipped about 9%. Those losses quickly reversed once Trump paused tariffs for many countries except China on February 9.
Bullish Scenario For Amazon
The bullish scenario for Amazon involves quick stabilization of the global economy. In a normal economic environment, Amazon should be able to grow earnings roughly 20% annually over the next five years. Applying that growth to the company’s current P/E ratio of 34 implies a five-year price target in the high-$400s. That’s more than double AMZN’s current price.
Amazon’s current P/E ratio is well below the company’s historic average, so this may be a conservative bull view.
Bearish Scenario For Amazon
If the world economy stagnates, the future looks different for Amazon and its shareholders. The 20% annual earnings gains will not materialize, at least until economic conditions stabilize.
Worse, investors will be reactive until the crisis ends. Any earnings miss or signs of slowness could prompt selloffs. There will be more volatility in Amazon’s stock price than in its business results. Price swings will be the defining trend for the foreseeable future.
Where Will Amazon Stock Be In 5 Years?
Amazon’s current price point will prove to be a super buying opportunity—but whether that happens in three, five or 10 years is uncertain. The timeline depends on the economic fallout from Trump’s ever-changing tariff policy.
Assuming the tariff crisis passes, Amazon’s five-year outlook is strong. The company can deliver double-digit earnings increases annually, thanks to its dominance across e-commerce, cloud computing and streaming entertainment. Investors who can hold on through the volatility could see their AMZN positions double in value, or better.
Bottom Line
Amazon is a good long-term investment, but economic conditions may delay the rewards beyond five years. At its current price, the e-commerce giant is a good growth pick for patient and thick-skinned investors. If that doesn’t describe you, look for more investing ideas in this list of best stocks for 2025.
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