Amazon shares jump (again) after inking $38bn deal with OpenAI for Nvidia chips

Key topics:OpenAI signs $38bn AWS deal for massive AI computing powerAmazon shares rise as cloud business gains AI industry endorsementOpenAI’s $1.4tn AI spending sparks global infrastructure boom.Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..By Matt Day.Amazon.com Inc.’s cloud unit has signed a $38 billion deal to supply a slice of OpenAI’s bottomless demand for computing power. Amazon shares jumped.The ChatGPT maker will pay Amazon Web Services for access to hundreds of thousands of Nvidia Corp. graphics processing units as part of a seven-year deal, the companies announced on Monday. The arrangement is the latest indication of OpenAI’s transition from research lab to an artificial intelligence powerhouse that has reshaped the technology industry. The company has committed to spending $1.4 trillion on infrastructure to build and power its AI models, an unprecedented binge that has prompted concerns about an investment bubble. For Amazon, which has struggled to compete in the AI age, the deal is an endorsement of its ability to build and run enormous networks of data centres. “As OpenAI continues to push the boundaries of what’s possible, AWS’s best-in-class infrastructure will serve as a backbone for their AI ambitions,” AWS Chief Executive Officer Matt Garman said in a statement. Amazon shares rose 4.5% to $255.29 as the markets opened in New York on Monday. Nvidia rose 3.3% to $209.20. .Read more:.Amazon shares jump 13% after reporting cloud unit grew at fastest rate since 2022 .Amazon is the world’s largest seller of rented computing power. But until Monday, AWS had been an outlier, having watched as just about every other significant cloud-computing company in the US joined the ranks of those building or retrofitting data centers to back OpenAI. .Microsoft Corp. — OpenAI’s largest investor and previously its exclusive cloud-computing provider — recently announced a new commitment from OpenAI to spend some $250 billion on its Azure cloud unit. Oracle Corp. has inked a $300 billion deal to provide OpenAI with data centers, and earlier this year OpenAI disclosed that Alphabet Inc.’s Google Cloud Platform was among the companies powering ChatGPT. The startup also has a $22.4 billion deal with CoreWeave Inc., a leader among a new crop of so-called neo clouds pitching their services to AI developers. “Adding AWS as a key cloud provider can ease some pressure for OpenAI, especially as it continues to farm out more contracts to neocloud providers like CoreWeave, which operates at a much smaller scale than AWS,” Bloomberg Intelligence analysts Anurag Rana and Andrew Girard wrote in a note last week forecasting such a deal. AWS could also help OpenAI expand internationally, given its global network of data centers, they said..Read more:.AWS outage disrupts major platforms and Amazon services.Under the deal announced Monday, OpenAI will immediately start using AWS computing power, with all of the targeted capacity to be provided before the end of 2026 and the option to expand its work with AWS in subsequent years. Amazon will deploy hundreds of thousands of chips, including Nvidia’s GB200 and GB300 AI accelerators, in clusters designed to help ChatGPT produce responses to user prompts or train next-generation models.“Scaling frontier AI requires massive, reliable compute,” OpenAI CEO Sam Altman said in a statement. “Our partnership with AWS strengthens the broad compute ecosystem that will power this next era and bring advanced AI to everyone.”Amazon is also among the biggest backers of Anthropic PBC, the AI developer founded by OpenAI veterans. The Seattle-based company announced last week that a data center complex built for the startup, and powered by hundreds of thousands of AWS’s homegrown Trainium2 AI chip, was operational. Last month, Google said it would supply up to 1 million of its specialized AI chips to Anthropic, a deal worth tens of billions of dollars. .© 2025 Bloomberg L.P.

Amazon shares jump (again) after inking $38bn deal with OpenAI for Nvidia chips

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