AWS is expected to soar to 35.5% growth, AI revenue has surged by nearly 500%! TD Cowen is optimistic about Amazon.com, Inc.(AMZN.US) delivering impressive Q2 results.

Analyst TD Cowen released a research report stating that Amazon.com, Inc.'s (AMZN.US) cloud business is accelerating growth and is expected to drive impressive second-quarter results for the company. The bank forecasts that AWS's second-quarter revenue growth rate year-on-year will reach 35.5%, higher than the 28.4% in the same period last year, and 3.4 percentage points higher than market consensus. Analyst John Blackledge attributes this impressive growth to the rapid increase in AI workloads. He pointed out that with Amazon.com, Inc.'s massive investment in AI infrastructure gradually alleviating supply bottlenecks, the company is better meeting the increasing demand for generative AI. Blackledge stated in a report to clients: "We estimate that Amazon.com, Inc.'s revenue related to generative AI is around $6.9 billion, an 88% increase month-on-month and a nearly 500% increase year-on-year. Among them, revenue related to Anthropic including Claude API calls, model training services, and Siasun Robot & Automation chat is expected to reach $4.6 billion, accounting for about two-thirds of AWS's generative AI total revenue." For the overall performance in the second quarter, Blackledge predicts that Amazon.com, Inc.'s total revenue will reach $200.1 billion, a 19.3% year-on-year increase, 1% higher than the upper limit of the company's guidance. North American market revenue is expected to increase by 15.1% (compared to 12.1% in the previous quarter), mainly driven by positive fundamental factors such as improved delivery speed and strong demand for daily necessities. Looking ahead to the third quarter, AWS is expected to provide strong support for performance expectations. TD Cowen's forecasts for Amazon.com, Inc.'s third-quarter revenue and operating profit are 0.3% and 3.2% higher than market consensus, mainly benefiting from the continued accelerated growth of AWS revenue driven by AI demand. Blackledge maintains a "Buy" rating on Amazon.com, Inc., but has lowered the target stock price by 3% to reflect the slight pullback trend the stock has seen since May.