AMZN·Amazon.com, Inc.

Amazon remains significantly cheaper than Walmart and Costco on a key valuation metric, a gap attributed to its higher operating leverage and lower cost structure. This lower valuation, however, is tempered by differing growth expectations, so traders should monitor Amazon’s earnings guidance and inventory metrics for signs of valuation compression or expansion. HSBC has named Amazon as an earnings pick for the upcoming season, citing robust revenue growth and a diversified business model, which signals confidence ahead of the Q4 results. The upcoming Q4 earnings release will be a key watch item, as guidance updates could confirm or challenge the current valuation narrative. On July 13, UK regulators will bring Amazon Web Services under direct financial oversight, requiring AWS to report financials directly to UK authorities and potentially raising compliance costs. The new oversight could affect AWS revenue growth and operational costs, so investors should track AWS quarterly disclosures for any changes in reporting structure or regulatory penalties. Amazon has also announced a 4 % increase in its North American data‑center pipeline, driven by growing demand from hyperscalers, which could strengthen AWS’s competitive position and support long‑term infrastructure strategy. While AWS recorded its fastest growth in 15 quarters, free cash flow collapsed 95 %, raising concerns about liquidity and capital allocation; management commentary on cash‑flow recovery will be critical to watch. Together, these developments suggest that Amazon’s valuation, earnings outlook, regulatory environment, and capital deployment decisions will shape its near‑term performance, so keeping an eye on Q4 earnings, AWS compliance costs, and data‑center expansion progress is essential.