Amazon Gets $300 Target From HSBC on $38B OpenAI Cloud Deal

Amazon (AMZN, Financials) just picked up another vote of confidence on Wall Street. HSBC lifted its price target on the stock to $300 from $285, saying Amazon's new partnership with OpenAI could be a game changer for its cloud business.

The seven-year, $38 billion deal will see OpenAI use Amazon Web Services to power and scale its artificial intelligence models. It's another sign that AWS already the backbone of the cloud industry is becoming even more essential as demand for AI computing explodes.

HSBC's analyst Paul Rossington said AWS's massive capacity buildout gave it an edge in winning the deal. The division has added nearly 3.8 gigawatts of data center capacity in the past year alone, with plans to double that again by 2027.

Amazon's cloud arm is already showing renewed strength, growing 20% year over year in the third quarter its fastest pace since 2022. Analysts say the OpenAI deal, along with new partnerships like the one with Cipher Mining, could keep that momentum going.

At around $254 a share, Amazon is trading near its highs for the year, but many analysts still see room to run. Some have targets as high as $350, betting that AWS's AI push is only just getting started.