Amazon.com (AMZN) will see improved gross margins driven by a more favorable trade cost environment, while revenue estimates remain largely unchanged, profitability will increase, Oppenheimer said in a note emailed Friday.

The company's e-commerce business continues to outgrow broader retail sales and has shown sustained market share gains, even if the pace has slowed slightly from the long-term trend, according to the note.

A more favorable tariff environment is leading to improved gross profit and earnings before interest and tax projections for Amazon's e-commerce segment, the firm added.

Oppenheimer said that Amazon is deepening its digital advertising footprint through Prime Video by forging partnerships with Roku (ROKU) and Disney (DIS) and the expanded reach enhances its long-term position in the ad market.

The firm raised its price target on Amazon's stock to $250 from $215 with an outperform rating.

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