Amazon’s (AMZN) Prime Video, which is the e-commerce giant’s video streaming business, is looking to shift its strategy by prioritizing live sports over original TV shows and movies, according to a report by The Information. This move is being made in order to meet internal profit targets and generate revenue through targeted ad placements during live sports events, as CEO Andy Jassy aims to make Prime Video profitable by the end of 2025. In fact, with real-time viewership, live sports can offer valuable opportunities for advertisers.
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As a result, Amazon has invested heavily in sports content by spending around $3 billion annually for broadcasting rights to major leagues like the NBA and NFL. The company has also secured deals for exclusive sports content, which includes an 11-year deal with the NBA that is valued at $77 billion. Additionally, Amazon began placing ads within its Prime Video platform last year to further expand its revenue streams.
Furthermore, as part of its new strategy, Amazon’s entertainment team has been commissioning fewer film and TV projects, according to the report. Nevertheless, the company still had a huge annual budget for original and licensed content of around $7 billion for 2024.
Is Amazon Stock Expected to Rise?
Turning to Wall Street, analysts have a Strong Buy consensus rating on AMZN stock based on 49 Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 48% rally in its share price over the past year, the average AMZN price target of $255.02 per share implies 9% upside potential.
