Amazon and OpenAI have reached a $38 billion agreement, under which Jeff Bezos‘s company will provide cloud computing services to Sam Altman’s firm, giving the company behind ChatGPT access to hundreds of thousands of Nvidia graphics processors for training and running its artificial intelligence models.
The deal announcement drove Amazon shares up 5% in pre-market trading, highlighting once again the AI industry’s growing demand for computing power.
What the Amazon and OpenAI agreement includes
According to the announcement, OpenAI will immediately begin using Amazon Web Services, with all planned capacity coming online by the end of 2026 and room for further expansion in 2027 and beyond. The agreement is one of OpenAI’s first major moves since completing its restructuring last week, which freed the ChatGPT maker from its non-profit roots.
Reuters previously reported that the company has laid the groundwork for an initial public offering that could value the company at up to $1 trillion.
However, the rapidly rising valuations of AI companies and their massive spending commitments, which collectively exceed $1 trillion for OpenAI, have raised fears that the AI boom is inflating into a bubble.
