Amazon stock closed near a record high after AI bets and layoffs
Analysts have increased their price targets for the e-commerce giant's shares
Amazon stock rose as high as $187.29 per share on Monday, hitting a 52-week intraday high and raising the possibility that the e-commerce giant could close at a new record. But the stock gave back those early gains to close up just slightly, at $185.19 per share. Its record close was $186.57 per share in July 2021.
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The stock gains come as Amazon has made big bets on generative artificial intelligence and has cut costs with layoffs across its Amazon Web Services cloud division.
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Amazon stock, which at one point was trailing its “Magnificent Seven” tech rivals, is up more than 23% so far this year alone, and more than 81% over the last 12 months. Morgan Stanley analyst Brian Nowak has raised his price target on the stock from $200 per share to $215.
Amazon bets big on AI
Amazon is in a race with other Big Tech rivals like Apple, Microsoft, and Google parent Alphabet to take advantage of AI. Last month, the Seattle-based Amazon invested an additional $2.75 billion in Anthropic, a San Francisco-based AI startup. That brought its total Anthropic investment to $4 billion.
The company has also touted how AI is helping it speed up pharmacy deliveries.
Layoffs at Amazon Web Services
Hundreds of employees were laid off earlier this month at Amazon Web Service (AWS), Amazon’s cloud computing division. The primary reason cited for the cost-cutting was slow sales growth in recent quarters.
In the past two years, almost 30,000 employees have lost their jobs across the company, which has contributed to Amazon’s growing profits. The company’s latest earnings report exceeded expectations, with revenues reaching $170 billion and earnings per share at $1.