Amazon Stock Is Soaring Again. 1 Reason to Buy Now (Hint: It’s Not AI)

For years, Amazon (NASDAQ: AMZN) was known for bold risks and minimal profits as the company invested in its businesses to grow revenue and market share, building out its customer base and competitive advantages.

Under CEO Andy Jassy, who’s run the company for more than two years, Amazon has shifted from an experimental, growth-focused start-up to a more mature company ready to monetize its existing businesses and be more disciplined with its capital.

Jassy laid off roughly 28,000 corporate employees last year and shut down unprofitable projects like the Scout home delivery and Amazon Care telehealth services. Those moves helped the company deliver soaring profits in 2023, and that leverage was on display in Amazon’s fourth-quarter earnings report, out last week.

Revenue in Q4 rose 14% to $170 billion, beating the analyst consensus at $166.2 billion. The company’s growth was even across its three business segments. At its North America and international segments, which are primarily made up of e-commerce sales, revenue rose 13% and 17%, respectively. North American revenue reached $105.5 billion, while international revenue was $40.2 billion.

Amazon Web Services, the cloud infrastructure business that has been the company’s primary cash cow in recent years, reported 13% growth to $24.2 billion. That was slower than both Microsoft Azure and Google Cloud, a sign that Amazon is losing market share, but it’s still the biggest cloud infrastructure business.

On the bottom line, all three divisions delivered solid growth as well. North America’s operating income was $6.5 billion, up from a loss of $0.2 billion in the same quarter a year ago. In its international segment, the operating loss narrowed from $2.2 billion to $0.4 billion, and AWS’ operating profit improved from $5.2 billion to $7.2 billion.

Jassy explained the solid growth in e-commerce, saying, “The regionalization of our U.S. fulfillment network led to our fastest-ever delivery speeds for Prime members while…