Under a multi-year, $38 billion agreement, Amazon.com will provide cloud computing services to OpenAI, granting the ChatGPT manufacturer access to hundreds of thousands of Nvidia graphics processors for the purpose of training and operating its AI models.
The deal made public on Monday demonstrates the AI sector’s growing demand for processing power, which is being fueled by the goal of developing technology that can equal or even exceed human intelligence. In premarket trading, it caused Amazon shares to rise 5%.
With all planned capacity expected to be online by the end of 2026 and space for additional growth in 2027 and beyond, OpenAI will start utilizing Amazon Web Services right away.
The agreement is one of OpenAI’s first significant actions since the company finished restructuring last week, which allows the ChatGPT creator to depart from its nonprofit foundation. According to Reuters, it was preparing for an IPO that might fetch up to $1 trillion for the business.
However, concerns that the AI boom is turning into a bubble have been sparked by the skyrocketing valuations of AI companies and their enormous spending commitments, which total more than $1 trillion for OpenAI.
