A Clash of Titans: Berkshire's Amazon Exit Meets Bullish Analyst Calls

Amazon becomes world's top revenue firm as Berkshire Hathaway slashes stake 77%. Analysts see $300 target on AWS and AI strength despite $200B spend.

The investment narrative surrounding Amazon presents a stark dichotomy. As one legendary investor's firm executes a dramatic retreat, prominent Wall Street analysts are simultaneously doubling down on ambitious price forecasts. Investors face a pivotal moment, caught between record-breaking revenue and the soaring costs of an all-in bet on artificial intelligence.

Record Revenue Amidst Market Turbulence

Fundamentally, Amazon has achieved a historic corporate milestone, surpassing Walmart to become the world's highest-revenue company. The tech giant reported annual sales of $717 billion for 2025, edging past the retail behemoth's $713.2 billion.

Despite this achievement, the company's shares have recently faced significant pressure. Investor anxiety over massive infrastructure expenditures triggered a nine-day losing streak that erased nearly $450 billion in market capitalization. A potential floor was only hinted at on February 17, when the stock price settled at $201.15 alongside a notable surge in trading volume.

Berkshire Hathaway's Substantial Pullback

In a move that has captured market attention, Berkshire Hathaway initiated a drastic reduction in its stake during the fourth quarter of 2025. Regulatory documents released on February 17 reveal the conglomerate slashed its Amazon position by approximately 77%, leaving it with just 2.3 million shares. This substantial sell-off coincides with the leadership transition from Warren Buffett to Greg Abel. Market observers interpret the divestment as a reaction to the e-commerce leader's aggressive capital expenditure strategy. Amazon has outlined plans for roughly $200 billion in investments this year, a figure that appears to have unsettled more conservative value-oriented investors.

The Bull Case: Cloud Strength and AI Dominance

In direct contrast to Berkshire's action, Morgan Stanley maintains a highly optimistic outlook. Analyst Brian Nowak reaffirmed an "Overweight" rating this week, holding firm to a $300 price target. The bank's thesis centers on the market's failure to adequately price Amazon's commanding position in generative AI into the current valuation.

The cloud division, Amazon Web Services (AWS), forms the cornerstone of this bullish perspective. Its backlog of committed business has surged 40% year-over-year to reach $244 billion. Morgan Stanley identifies a clear competitive edge here, fueled by AI tools like the shopping assistant Rufus, which is expected to continue driving revenue growth.

The company's enormous $200 billion wager on AI infrastructure continues to polarize market sentiment intensely. While Berkshire Hathaway's sale counsels caution, AWS's robust order backlog and new status as the global revenue leader signal that the core growth narrative remains intact. The coming quarters' financial results, which will measure the return on this historic investment, are likely to determine the stock's next sustained move.