Could This Be Amazon's Next Big Opportunity?

Amazon is expanding its AI chip business beyond internal use, with CEO Andy Jassy revealing plans to sell Trainium custom AI chips to external customers. Jassy estimates the AI chips business currently runs at a $50 billion annual rate and projects it could surpass $100 billion within years.

The move represents a significant strategic shift for AMZN, transforming its in-house chip development into a potential standalone revenue driver. Amazon originally built Trainium to reduce reliance on third-party GPU suppliers for its AWS cloud infrastructure. Opening sales to external customers would pit the company directly against Nvidia and other chip manufacturers in the rapidly expanding AI semiconductor market.

The initiative builds on Amazon's existing AWS momentum, which already serves as the company's highest-margin segment. By commercializing Trainium, Amazon could capture a larger share of enterprise AI spending while potentially reducing chip costs for its own operations through economies of scale.