Alphyn Capital Management's Comments on Amazon.com, Inc. (AMZN)

Alphyn Capital Management, an investment management firm, released its second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The Master Account of the fund returned 12.4% net in the second quarter compared to 10.9% for the S&P 500 Index. As of the second quarter of 2025, the top ten holdings accounted for approximately 65% of the portfolio, and approximately 17% of the portfolio was held in cash. Market conditions remained volatile in Q2 due to ongoing tariff developments and evolving interest rate projections. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second quarter 2025 investor letter, Alphyn Capital Management highlighted stocks such as Amazon.com, Inc. (NASDAQ:AMZN). Amazon.com, Inc. (NASDAQ:AMZN) provides consumer products, advertising, and subscription services through online and physical stores. The one-month return of Amazon.com, Inc. (NASDAQ:AMZN) was 4.79%, and its shares gained 14.28% of their value over the last 52 weeks. On July 10, 2025, Amazon.com, Inc. (NASDAQ:AMZN) stock closed at $222.26 per share, with a market capitalization of $2.36 trillion.

Alphyn Capital Management stated the following regarding Amazon.com, Inc. (NASDAQ:AMZN) in its second quarter 2025 investor letter:

"Amazon.com, Inc.'s (NASDAQ:AMZN) structural edge keeps widening. Its high-return, capital-light businesses compound without depending on the retail cycle. AWS is growing at mid-teens rates with nearly 40% segment margins and now contributes more than half of the group's operating income. Advertising, an asset-light adjunct to the marketplace, is expanding even faster at 19% and directly impacts the bottom line. Meanwhile, the core retail business continues to benefit from the regionalized fulfilment network built over the last two years. North American retail margins would have reached roughly 7% absent tariff-related charges.

Amazon generated approximately $25 billion of trailing free cash flow, more than enough to cover stepped-up investments in artificial intelligence and robotics, while also funding Project Kuiper, whose first production satellites launched in April and can extend AWS into connectivity white spots around the world. I view Amazon as a self-funded, multi-legged compounding machine that trades at what appears to be a mid-teen multiple of normalized free cash flow."

Amazon.com, Inc. (NASDAQ:AMZN) is in first position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 328 hedge fund portfolios held Amazon.com, Inc. (NASDAQ:AMZN) at the end of the first quarter compared to 339 in the fourth quarter. In Q1 2025, Amazon.com, Inc. (NASDAQ:AMZN) achieved global revenue of $155.7 billion, representing an 10% year-over-year growth excluding the impact of foreign exchange.  While we acknowledge the potential of AMZN as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Amazon.com, Inc. (NASDAQ:AMZN) and shared the list of best stocks to invest in for good returns. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.