Looking at where the brightest investing minds in tech are putting their money is a great way to source stock ideas. One of the more impressive founders in Silicon Valley history is Peter Thiel, even if he is a controversial figure. Thiel helped found PayPal and Palantir, but now, he also runs a hedge fund. That fund, Thiel Macro, has a relatively concentrated portfolio, and as recently as the first quarter, it held no stocks at all. But in the second quarter, Thiel picked up a new set of investments, and the largest of those positions may come as a surprise: Amazon (NASDAQ: AMZN).
Amazon’s AI results are starting to speak for themselves. Should you follow Thiel’s lead and buy shares?
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1/100th the size of Nvidia. Continue »
Amazon is more of an AI company than it gets credit for
The most recent information we have about Thiel Macro’s holdings comes from the hedge fund’s second-quarter 13F filing, which reflects the positions it had as of June 30. That’s a ways back, so its positions could have shifted, but with Amazon accounting for 28% of the portfolio at the end of Q2, I think it’s worth paying attention to. Outside of Amazon, the fund’s other stakes were all in energy companies, so it’s clear that Thiel believes that AI infrastructure and the companies delivering the electricity to power it are the places to invest right now.
Amazon operates the largest cloud computing service in the world, Amazon Web Services (AWS). It has been investing hundreds of billions of dollars into this business to build as many AI data centers as it can, as growing AI workloads have led to unprecedented demand for computing power. While AWS only made up 21% of revenue during Q2, it accounted for 60% of the company’s operating profits. That’s because AWS’ margins are vastly superior to those of Amazon’s commerce business, so even though it is a smaller segment in terms of revenues, the profits the company makes from each dollar that comes through that channel are far greater.
Furthermore, AWS’ growth rate has accelerated over the past few quarters. In 2025, its growth rate hovered in the low-20% range. Now, it’s up to 37%. That shows tremendous progress, and as more compute comes online, the company’s data center investments will convert into revenue and profit growth.