Amazon is growing on the stock market after a deal with OpenAI for $38 billion. He recently announced layoffs
For investors, this is another signal that AWS's position in the race for a generative artificial intelligence customer is growing. Amazon is strengthening its role not only as a cloud provider, but also as an integrator of the AI ecosystem. The giant offers customers access to advanced Nvidia systems and its own infrastructure solutions, while attracting the leading players in the language model market. In the short term, the market is discounting the prospect of greater use of AWS resources and, consequently, higher revenues of the cloud segment.
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This is part of OpenAI's strategy
The agreement is part of OpenAI's broader strategy, which has been diversifying infrastructure partners for months. In addition to the contract with Amazon, the company has, among others, worth $300 billion agreement with Oracle and agreements with CoreWeave worth over USD 22 billion, as well as agreements with Broadcom, AMD and Nvidia.
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However, this network of circular transactions is fueling fears that demand for AI power may be overestimated and the sector is starting to look like a bubble. According to calculations quoted in the industry OpenAI costs may exceed $1 trillion. by the end of the decadewhile revenues remain significantly lower. This raises questions about the company's ability to finance infrastructure commitments as they materialize.
At the same time, OpenAI announced a new agreement with Microsoft, which enables the company to be transformed into a for-profit public benefit corporation. This opens the way to a stock exchange debutas we wrote on Business Insider. According to Reuters, work is underway on an IPO with a valuation of up to $1 trillion. If it takes place, the issue could become a financial safety brake for rapidly growing infrastructure expenditures – although given the current cost dynamics it will not solve all capital challenges.
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Against the background of these reports, the condition of Amazon itself looks solid. Last week, the company showed better-than-expected third-quarter resultswhich had already pushed the rate to historic highs. AWS also announced that it has completed the construction of a large AI data center and will deliver one million of its own artificial intelligence chips to OpenAI's competitor, Anthropic, by the end of 2025. On the one hand, this highlights Amazon's aggressive expansion in computing infrastructure, on the other – it clearly shows that hyperscalers are playing on many fronts, serving parallel model creators.
Recently, Amazon also announced that it would lay off approximately 14,000 people. people. The company's shares have increased by 16 percent since January.
