Amazon's (AMZN 1.70%) share price is up 38% over the past three years, making its returns nearly identical to the S&P 500's over the same time frame. Beating the market is the long-term goal of many investors, so it's understandable why some may be wondering what's the best course to take with Amazon right now.

I think there are several compelling reasons why holding onto your Amazon stock if you have it or buying shares now could still be a great strategy. Here are three reasons to buy (or continue holding) Amazon stock in 2025.

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AI cloud computing is just getting started

Some investors were disappointed by Amazon's recent fourth-quarter results, in which the company's Amazon Web Services (AWS) revenue of $28.79 billion slightly missed Wall Street's consensus estimate of $28.84 billion. Still, AWS sales were up 19% from the year-ago quarter and the segment accounted for 50% of Amazon's total operating income.

I think investors who reacted negatively missed the bigger picture with Amazon and its cloud opportunities. AWS is still the leading cloud provider, with 31% of the market share, ahead of Microsoft with 20%.

That puts Amazon in an amazing position to benefit as demand for artificial intelligence (AI) cloud computing grows. Companies are in a race to have the most capable AI services and Goldman Sachs estimates that AI cloud revenue could reach global sales of $2 trillion by 2030. As the undisputed leader in cloud computing, Amazon should be able to tap into the surge of AI cloud services.

Amazon still dominates e-commerce

While plenty of retailers have made strides in their e-commerce offerings, they still fall short of Amazon's dominance. The company has about 40% of the U.S. e-commerce market, compared to rival Walmart's 7%.

And the company continues to improve its platform and delivery network to make shopping even better for customers. Amazon delivered over 65% more items to its Prime members on the same day they ordered or overnight in the fourth quarter of 2024 compared to a year earlier. It also had a record-breaking Black Friday week and Cyber Monday event last year.

The result was that North American sales jumped 10% in the fourth quarter to $115.6 billion and operating income from the segment rose 43% to $9.3 billion.

E-commerce accounted for about 16% of all retail sales in the U.S. last year and will increase to 20% by 2028, according to eMarketer. With Amazon's leading position and more e-commerce growth on the way, the company is poised to benefit.

Advertising continues to be a winner

It's worth mentioning briefly that Amazon's advertising business continues to expand. Ad sales rose by 18% in the fourth quarter to $17.3 billion. To put that in perspective, Amazon had just $12.6 billion in annual ad sales in 2019.

Amazon will take about 15% of the digital advertising market this year, according to estimates from Statista, making the company an increasing threat to other online ad companies. Amazon's ad revenue topped $56 billion in 2024 and management says its ad revenue will have an annual revenue run rate of $69 billion this year.

While it's not Amazon's most important business, it's become a healthy addition to the company's growing dominance across new markets.

Is there a case to sell Amazon?

I don't think there's much of a case for selling Amazon stock right now. Of course, there are always legitimate financial reasons for selling a stock, like buying a home or paying for a child's tuition.

Amazon continues to benefit from its core e-commerce and cloud computing businesses and has increasing opportunities from smaller segments like advertising. Since the company is a clear leader in its respective markets, buying Amazon (or holding what you have) still looks like a smart move.

And while the stock isn't exactly cheap -- it trades at a forward price-to-earnings multiple of 32.3, compared to the S&P 500's 23.8 -- it's still relatively well-priced considering the company's long-term prospects.