Amazon Is the Worst Dow Stock After Earnings. Here's Why
Amazon stock is at the bottom of the Dow Friday as the e-commerce giant's soft outlook offsets a fourth-quarter beat. This is what you need to know.


Amazon.com (AMZN) is the worst Dow Jones stock Friday as the world's largest e-commerce company's weak first-quarter guidance offsets a top- and bottom-line fourth-quarter beat.
In the three months ending December 31, Amazon's revenue increased 10% year over year to $187.8 billion. Its earnings per share (EPS) surged 86% from the year-ago period to $1.86.
"The holiday shopping season was the most successful yet for Amazon and we appreciate the support of our customers, selling partners, and employees who helped make it so," said Amazon CEO Andy Jassy.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The results beat analysts' expectations. Wall Street was anticipating revenue of $187.3 billion and earnings of $1.49 per share, according to CNBC.
Amazon also said that revenue from its Amazon Web Services (AWS) cloud segment increased 18.9% to $28.8 billion and advertising revenues were up 18% from year-ago period to $17.3 billion.
Analysts were anticipating AWS revenue of $28.8 billion and advertising revenue of $17.4 billion.
"Probably the biggest number for investors was growth in AWS ... [which grew] right in line with the analysts," says Stephen Callahan, trading behavior specialist at Firstrade. "Compare that to Alphabet (GOOGL) and Microsoft (MSFT), which both saw growth decelerate in their cloud divisions. This means Amazon is winning more AI [artificial intelligence] business than its competitors and has regained the leadership position in AI."
For its first quarter, Amazon said it expects to achieve revenue in the range of $151 billion to $155.5 billion, representing growth of 5% to 9% from the year-ago period. The midpoint of this range, $153.25 billion, came up short of the $158.8 billion in revenue analysts were calling for.
"Amazon's guidance for the first quarter was weaker than expected because it forecast a big forex hit," Callahan adds. "This will be an issue going forward."
Is Amazon stock a buy, sell or hold?
Amazon has put in a strong performance on the price charts over the past 12 months, up 36% vs the S&P 500's 22% return. And Wall Street thinks the Magnificent 7 stock has even more room to run.
According to S&P Global Market Intelligence, the average analyst target price for AMZN stock is $258.03, representing implied upside of more than 12% to current levels. Additionally, the consensus recommendation is a Strong Buy.
Financial services firm Wedbush reiterated its Outperform rating (equivalent to a Buy) and $280 price target on the consumer discretionary stock after the earnings release.
"Amazon reported healthy Q4 results with operating income roughly 11% above consensus," says Wedbush analyst Scott Devitt. He adds that possible catalysts for AMZN in the intermediate term include AI-driven AWS growth, automation gains, Alexa AI commercialization, Project Kuiper monetization and a potential Prime price hike. Amazon most recently raised the price on Prime subscriptions in 2022.
Related Content
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.
-
Stock Market Today: A Historic Quarter Closes on High Notes
"All's well that ends well" is one way to describe the second quarter of 2025, at least from a pure price-action perspective.
-
Is It Worth Getting a Free iPhone Through T-Mobile?
T-Mobile offers a free iPhone 16 Pro with select plans, including a 55+ option. Is the incentive worth the switch over?
-
Stock Market Today: A Historic Quarter Closes on High Notes
"All's well that ends well" is one way to describe the second quarter of 2025, at least from a pure price-action perspective.
-
Keep Tax Collectors at Bay with Muni Bond Funds
Municipal bonds can be good insurance against inflation — and interest is tax-free. But as with all investments, understanding risk is key.
-
Eight Tips From a Financial Caddie: How to Keep Your Retirement on the Fairway
Think of your financial adviser as a golf caddie — giving you the advice you need to nail the retirement course, avoiding financial bunkers and bogeys.
-
Just Sold Your Business? Avoid These Five Hasty Moves
If you've exited your business, financial advice is likely to be flooding in from all quarters. But wait until the dust settles before making any big moves.
-
Cord Cutting Could Help You Save Over $10,000 in 10 Years
How cutting the cord can save you money and how those savings can grow over time.
-
Should I Buy Stocks or Bonds Right Now?
Generally speaking, stocks provide reasonable growth while bonds provide stable income. Each play important roles in diversified portfolios.
-
You Were Planning to Retire This Year: Should You Go Ahead?
If the economic climate is making you doubt whether you should retire this year, these three questions will help you make up your mind.
-
Are You Owed Money Thanks to the SSFA? You Might Need to Do Something to Get It
The Social Security Fairness Act removed restrictions on benefits for people with government pensions. If you're one of them, don't leave money on the table. Here's how you can be proactive in claiming what you're due.