Amazon vs Meta: Which Stock Is the Better Buy?

TLDR

• Amazon’s AWS revenue hit $128.7B in 2025, up 20%, making it the core of Amazon’s AI strategy
• Meta’s revenue grew 22% to $200.97B, with AI already boosting ad performance and engagement
• Amazon’s free cash flow dropped from $38B to $11B as capex soared ahead of a projected $200B spend in 2026
• Meta operates at a 41% operating margin with 3.58 billion daily active users across its apps
• Wall Street rates both as Moderate Buy, with Amazon’s average target at $287.29 and Meta’s at $837.72

Amazon and Meta are two of the biggest spenders in artificial intelligence right now. But they are investing in very different ways, and the returns are showing up differently too.

Amazon’s AI bet is built around its cloud division, AWS. In 2025, AWS brought in $128.7 billion in revenue, up 20% year over year. Operating income from AWS reached $45.6 billion. The company says its AI services within AWS are already running at over $15 billion in annualized revenue.

Amazon.com, Inc., AMZN

Amazon’s chip business has also passed a $20 billion annualized run rate. These are large numbers, but the spending required to get there is just as large.

Amazon’s overall net sales rose 12% to $716.9 billion in 2025. Operating income came in at $80 billion and net income reached $77.7 billion. Those are strong figures.

But free cash flow tells a different story. It fell from $38 billion in 2024 to just $11 billion in 2025. Capital expenditures jumped sharply, and Reuters reported Amazon is planning around $200 billion in capex for 2026, most of it tied to AI infrastructure.

Meta’s AI Is Already Working in Its Core Business

Meta’s numbers look cleaner at this stage. Revenue grew 22% to $200.97 billion in 2025. Operating income rose 20% to $83.28 billion. The operating margin held at 41%.

Meta Platforms, Inc., META

Daily active users across Meta’s family of apps reached 3.58 billion in December 2025. Ad impressions grew 12% for the full year. The average price per ad rose 9%. Meta’s AI investment is flowing directly into better ad targeting and higher engagement, which shows up quickly in revenue.

Meta spent $72.22 billion on capital expenditures in 2025. That is a large number, but investors can already see it working. Amazon’s spending may pay off too, but the returns are harder to see right now.

What Analysts Think

Wall Street is positive on both companies. Amazon carries a Moderate Buy consensus from 59 analysts, with 55 buys and 4 holds. Its average price target is $287.29.

Meta also holds a Moderate Buy rating, based on 50 analyst ratings with 42 buys and 8 holds. Its average price target is $837.72.

The rating mix is slightly more cautious on Meta by proportion, but both stocks are well-supported by analyst coverage.

Amazon offers broader exposure across retail, logistics, cloud, and advertising. Meta is more focused, but its margins are high and its AI results are already visible.

Final Thoughts

Amazon is the bigger, more complex bet. Meta is the tighter story with cleaner near-term returns. Both are spending heavily, but where that money shows up in earnings today is what separates them.

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