Amazon (AMZN) stock is currently down 6% in the last five days and over 8% in the past month, trading near a 2-month low. Entering 2025, analysts were extremely bullish on AMZN, and early on the stock has been promising. However, this recent low could trigger some bearish momentum in the Magnificent-7 member, especially as others look to climb past Amazon.

There are several factors that may be playing a role in why Amazon stock is down recently. Last Friday, The price dropped significantly at a close, losing nearly 3% and testing lows around $214.74, the lowest level since early December. This could be due to its Q1 earnings/revenue falling just below expectations. While Amazon.com, Inc. posted solid revenue of $187.79 billion, its Q1 2025 sales forecast of $151 billion to $155.5 billion fell short of Wall Street’s $158.5 billion expectation.

Amazon’s AI Investments Stirring the Pot for Stock Investors?

Additionally, some analysts may not be as optimistic about Amazon’s incoming spending plan for its Web Services and AI investments. While AI is set to help the majority of the Magnificent-7 due to immense hype, there may be worry that Amazon is putting more eggs into the basket than needed. Analysts on Nasdaq note this volatility, alongside competition from Microsoft and Alphabet, has sparked bearish sentiment in AMZN stock, even as the company’s market cap holds strong at $2.23 trillion.

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On the other hand, with AMZN dipping slightly, some stock experts are suggesting that now could be a good window to buy in. The company is expected to maintain solid stock performances in 2025 like it did last year. Thus, any period of flux can be seen as a chance to “buy the dip.” Additionally, this dip combined with the recent reassurance by CEO Andy Jassy of continued AI development is, in fact, a good sign. AI and tech companies investing in software dominate Wall Street. That trend is expected to continue in the future.

Despite the decline in Amazon’s stock on Friday being one of the steepest in the past two months, there are still technical indicators that indicate this won’t last for long. The devaluation of AMZN stock halted precisely at the lows from early 2025, which, together with the highs from November 2024, now serve as local support. This could present an opportunity for a rebound following an almost 11% correction from the historical high of $242.50, tested on February 4. However, a failure to rebound could see Amazon stock fall below $200. Amazon’s current investments in AI will hope to fight this market dip and send stocks back towards higher levels.