Amazon Tops Microsoft as Better AI Buy on 37% AWS Growth
Updated
Updated · The Motley Fool · Aug 16
Amazon Tops Microsoft as Better AI Buy on 37% AWS Growth
3 articles · Updated · The Motley Fool · Aug 16
Summary
Amazon was judged the stronger AI investment because AWS growth accelerated to 37% in the third quarter, giving it a near-term upside edge over Microsoft.
That growth case rests on similar business breadth at both companies, with each benefiting from AI-driven cloud demand and spending hundreds of billions of dollars to expand capacity.
Operating profit growth also favored Amazon, as AWS's higher-margin mix widened its advantage when excluding distortions from stakes in Anthropic and OpenAI.
Microsoft looked cheaper on an operating-profit valuation measure, but Amazon appeared cheaper on forward earnings, reinforcing the analysis that Amazon offers the better overall AI bet.
The comparison still framed Microsoft as a solid long-term holding, even as Amazon was seen as the more attractive AI play right now.