As Amazon continues to show impressive growth in its cloud computing segment, AWS, and its retail business, JPMorgan Chase has raised its price target on the company to $330, representing a 25% upside potential. This increase in optimism comes after the company’s strong earnings report, which saw accelerating revenue growth in both its North American and International segments, as well as a significant surge in backlog to $364 billion.

One of the key drivers of Amazon’s growth is its increasing focus on artificial intelligence (AI) and automation. The company has made significant investments in these areas, and it is paying off. AWS, Amazon’s cloud computing segment, saw revenue growth accelerate to its fastest pace in 15 quarters, with a 28% year-over-year increase. This growth is being driven by increasing demand for AI-powered services, such as machine learning and computer vision, which are critical components of many modern businesses.

In addition to its AWS segment, Amazon’s retail business also saw significant growth, with same-store sales reaching post-COVID highs. This is a testament to the company’s ability to adapt and innovate in response to changing consumer preferences and market conditions.

JPMorgan Chase’s increased optimism on Amazon is not limited to its AWS and retail segments, however. The investment firm also sees potential upside from Prime Day, which is expected to be a significant driver of growth in the coming months. Additionally, the company’s focus on automation and continued innovation in AI-powered services bodes well for future growth.

Given Amazon’s continued growth and JPMorgan Chase’s increased optimism, one might wonder how to play this opportunity. One potential strategy is to use options to take advantage of the company’s implied volatility and call skew, which have collapsed back towards 1-year lows. Specifically, JPM likes using cheap upside optionality via Aug’26 300/330 call spreads into Prime Day, the AWS Summit, and earnings, targeting continued AI-driven upside.