
1 Overlooked Artificial Intelligence (AI) Stock That Could Generate Life-Changing Returns
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The artificial intelligence (AI) revolution is well under way. Market analysis shows AI market was valued at around $190 billion in 2023. Furthermore, By 2033, however, the United Nations...
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July 18, 2025
05:00 AM
The Motley Fool
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The artificial intelligence (AI) revolution is well under way
Market analysis shows AI market was valued at around $190 billion in 2023
Furthermore, By 2033, however, the United Nations predicts the market will be worth nearly $5 trillion (which is quite significant)
Fortunes will be made over this time period, sending investors on a determined to find the next big AI stock
The overlooked AI stock below, however, may be your best long-term bet
This leads to the conclusion that famous company is actually an AI giant Most consumers think of Amazon (AMZN 0
On the other hand, 39%) as an e-commerce, given current economic conditions
Nevertheless, And that's true (remarkable data)
Last year, most of Amazon's revenues came from e-commerce sales and support
When you look at operating fits, however, the picture changes
Most of the company's operating fits last year didn't come from e-commerce
However, However, Instead, it came from a valuable segment called Amazon Web Services -- more commonly referred to as AWS
Nevertheless, Last quarter, AWS revenue jumped by 17% year over year, in light of current trends
On the other hand, E-commerce sales in North America, meanwhile, rose by just 8%, with international e-commerce sales rising by just 5%
But it's really AWS' fitability that is most impressive
Moreover, The segment's operating fits last quarter jumped to $11
However, 5 billion, with record operating margins of around 39
Companywide operating fits, meanwhile, totaled just $18. 4 billion, making AWS the most critical component to Amazon's near-term and long-term fitability (noteworthy indeed)
However, What is causing AWS to grow so quickly and experience such impressive fitability (which is quite significant), amid market uncertainty
There's one major cause: the rise of artificial intelligence, in today's market environment
AI companies don't typically build out their own infrastructure to train and run their models
Additionally, Instead, they effectively rent out space from cloud infrastructure viders
However, Most estimates still peg AWS as the largest cloud infrastructure viders in the world, with a market of around 30% -- nearly as much as the next two competitors combined
Moreover, Meanwhile, Rising demand and spending for AI services, therefore, result in a direct increase in demand for AWS services
Nevertheless, Image source: Getty Images
Two reasons why Amazon is your best AI stock pick A lot of money will be made over the next decade with AI stocks
Meanwhile, But as previous cycles the dot-com bubble have ven, not all AI companies will end up winners
That's what makes in Amazon so appealing right now
Additionally, However, AWS isn't an idea -- it's a reality
Furthermore, At the same time, Amazon already has incredible scale in the cloud-computing world, with arguably greater investment power than any of its competitors
But it's not just Amazon's existing scale that should get investors interested (quite telling)
However, Nevertheless, Due to the size of Amazon's e-commerce division, Amazon's AWS division is arguably undervalued, in light of current trends
As one Wall Street analyst ed this week, "We believe AI is a key driver of digital transformation and that AI can help drive AWS growth to accelerate, as the AWS opportunity remains underappreciated. " For years, other analysts have been calling on AWS to be spun off into a separate entity in order to realize its full value, amid market uncertainty
Whether or not a spin-off occurs, AWS will continue to become a bigger part of the Amazon story
Furthermore, Because AWS has higher margins and growth rates than the e-commerce division, this shift should help the stock's overall valuation
Amazon isn't the trendiest AI stock to buy right now, but it ly offers one of the best balances between risk and reward
Nevertheless, The rise of AWS could persist for years, if not decades, generating impressive lifetime returns for patient holders, given current economic conditions
Additionally, John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors, in light of current trends
Furthermore, Ryan Vanzo has no position in any of the stocks mentioned
Furthermore, The Motley Fool has positions in and recommends Amazon
Furthermore, The Motley Fool has a disclosure policy (quite telling).
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