E-commerce giant Amazon (AMZN) just upgraded its Alexa voice assistant with Alexa+, which will now use generative AI in order to better compete with products offered by Google (GOOGL) and Microsoft (MSFT). Alexa+ will run on Amazon’s own large language models and those from Anthropic, an AI company that Amazon has invested heavily in. The new feature is set to launch in the U.S. in the coming weeks and will be available for $19 per month or free for Prime users.
One of the key benefits of Alexa+ is its ability to perform a wide range of tasks across multiple apps. Indeed, during a demo, Amazon’s head of devices and services, Panos Panay, showed off features like remembering personal preferences, controlling smart home devices, and answering in-depth questions. The goal is to make conversations with Alexa+ feel more natural and intuitive. Whether or not Alexa+ becomes a hit still remains to be seen, but Amazon will continue to invest heavily into generative AI, with plans to spend over $100 billion on the technology in 2025.
In fact, CEO Andy Jassy also revealed that Amazon has developed or is currently developing 1,000 generative AI apps. According to Jassy, Amazon’s investment in AI is greater than those of other companies, and stated, “I’m not aware of any company that has made a larger investment in AI, from top to bottom.” Jassy also highlighted Amazon’s Trainium 2 AI chip, which he claimed comes with a significant 30% to 40% improvement in price performance compared to rival chips, including those from Nvidia (NVDA).
Is Amazon Stock Expected to Rise?
Overall, Wall Street has a Strong Buy consensus rating on AMZN stock based on 47 Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 24% rally in its share price over the past year, the average AMZN price target of $268.91 per share implies 25.31% upside potential.
