Jim Cramer says there’s only one way Amazon stock will get unstuck. “When I speak to Andrew Jassy, the CEO, I’m saying, ‘Listen, when are you going to accelerate Amazon Web Services? Azure is kicking your butt,” Jim said during Wednesday’s Morning Meeting for Club members. Azure is Microsoft ‘s cloud unit, which is No. 2 to AWS. Alphabet ‘s Google Cloud is the third biggest. Tapering revenue growth at Amazon’s high-margin cloud business has been the biggest drag on the stock. Amazon has been the worst-performing member of the “Magnificent Seven” tech names, barely moving higher this year while rivals were soaring. Shares of the e-commerce and cloud giant were up less than 1% year to date, while Alphabet and Microsoft rose 32% and 21%, respectively, so far in 2025. The S & P 500 has gained 13% year to date. Reacceleration of AWS growth “would be what you need,” to take the stock higher, Jim added. AMZN YTD mountain AMZN stock performance YTD. To be sure, AWS has been growing. It’s doing so more slowly than its peers. In the second quarter, AWS revenue rose 17.5% year over year but was overshadowed by Azure’s 39% gain and Google Cloud’s 32% advance . It marked the second straight quarter of slowing AWS momentum, reinforcing fears that the market leader was falling behind in the generative AI race. Jeff Marks, director of portfolio analysis for the Club, echoed that concern. “The stock has just been stuck,” he said, pointing to AWS’ need to get “more aggressive at least on the AI front.” While Amazon has signaled progress with its partnership with AI start-up Anthropic, investors are still waiting for a meaningful turnaround. Jim said he was encouraged by Wells Fargo turning bullish on AWS revenue reacceleration, which the analysts labeled “as the key to the reversal of share underperformance.” Wells upgraded Amazon to an overweight buy from equal weight hold and lifted their price target to $280 per share from $245. That new PT implies 27% upside to its current market price of $220. The optimism from the analysts at Wells stems from Amazon’s massive AI supercomputer, known as Project Rainier, which is being developed with Anthropic, the company behind the Claude chatbot. Rainier is designed to ease Anthropic’s capacity constraints, allowing it to handle more demand from consumers and enterprises using the technology. That, in turn, should drive more computing revenue for AWS. Wells Fargo expects Anthropic to contribute 7 percentage points to AWS growth in 2026, up from 3 points in 2025. We, too, see this as a long-term driver, but stress that AWS needs to show results since investors have been waiting for AWS reacceleration. Until that happens, Amazon’s other efforts, including grocery expansion and lowering its cost-to-serve, may not be enough to move the stock meaningfully higher. We maintain our buy-equivalent 1-rating on Amazon stock and price target of $250. (Jim Cramer’s Charitable Trust is long AMZN, MSFT. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
