Amazon will invest $50 billion in OpenAI, starting with an initial $15 billion and followed by an additional $35 billion tied to certain conditions. This comes as OpenAI closed its massive $110 billion funding round, reportedly at a pre-money valuation of $730 billion.
Amazon’s investment is the highest among its peers in this round, as Nvidia and SoftBank have promised to invest $30 billion each in this round.
“OpenAI… is an extremely talented team with great products, IP, and vision for how they can continue to serve customers and enterprises. We think they’ll be one of the big winners in AI, we can help them grow, and we believe we’ll earn a strong return for Amazon over the long term,” said Amazon CEO Andy Jassy in a post on X.
Amazon has entered into a multi-year and multi-fold partnership with OpenAI alongside its investment. This would entail a joint development of a Stateful Runtime Environment (SRE) powered by OpenAI’s models, which will be made available through Amazon Bedrock. Designed for enterprise use, an SRE is an environment that allows artificial intelligence (AI) systems to retain context, access compute and memory, integrate across software tools and data sources, and manage ongoing workflows. Amazon Bedrock is a service by Amazon Web Services (AWS) that enables building and scaling generative AI (GenAI) applications.“Combining OpenAI’s intelligence with Amazon’s infrastructure and global reach helps us put powerful AI into the hands of businesses and users at real scale,” said OpenAI CEO and cofounder Sam Altman.
AWS will also become the exclusive third-party cloud distribution provider for OpenAI Frontier, the company’s advanced enterprise AI platform. Frontier allows enterprises to build, deploy, and manage teams of AI agents that function across real business systems with shared context, built-in governance, and enterprise-grade security.
The two companies are further expanding their existing cloud agreement by $100 billion over eight years. OpenAI will commit to consuming approximately 2 gigawatts (GW) of AWS Trainium compute capacity, including future Trainium3 and Trainium4 chips. This long-term arrangement is designed to lower costs, improve efficiency, and secure large-scale compute capacity to support advanced AI workloads such as SRE and Frontier. Training is specialised, high-performance computing resource of AWS, which is designed to accelerate the training and fine-tuning of large language models (LLMs) and generative AI.
Finally, the two companies will also collaborate on developing customised models tailored for Amazon’s customer-facing applications, complementing Amazon’s existing AI offerings, including its Nova model family.
