Amazon (NASDAQ: AMZN) CEO Andy Jassy has put a remarkable number on one of his company’s least-discussed business units, drawing fresh attention to its custom chip ambitions.
Speaking on the company’s first-quarter earnings call in April, Jassy said Amazon’s in-house chip operation has surpassed a $20 billion annual revenue run rate, growing at triple-digit percentage rates year over year.
He also revealed that customers have committed more than $225 billion in future revenue specifically tied to Amazon’s Trainium artificial intelligence accelerator chips.
Jassy went further with a hypothetical benchmark, suggesting that if Amazon sold its chips on the open market like other chipmakers, the unit’s annual revenue run rate would reach approximately $50 billion.
Amazon’s custom silicon portfolio includes Graviton processors, Trainium AI accelerators, and Nitro networking chips, all deployed within Amazon Web Services (AWS).
The chip business grew nearly 40% quarter over quarter in the first quarter alone, and Jassy said the operation is now, as best the company can tell, “one of the top three data center chip businesses in the world.”
The $225 billion commitment figure comes with recognizable names attached, including OpenAI, which committed to approximately two gigawatts of Trainium capacity beginning in 2027.
Anthropic agreed to secure up to five gigawatts of current and future Trainium chip generations, while Meta Platforms (NASDAQ: META) signed on to deploy tens of millions of Graviton cores, and Uber is using Graviton chips to match riders with drivers.
Supply constraints are already emerging, with Jassy noting that “our Trainium2 chip has about 30% better price-performance than comparable GPUs, and has largely sold out.”
Trainium3, which started shipping at the beginning of 2026, is nearly fully subscribed, and much of Trainium4, still more than a year from broad availability, has already been reserved.
Despite the momentum, Nvidia (NASDAQ: NVDA) remains far larger in AI data centers, and Amazon itself announced plans in its first-quarter report to deploy more than 1 million Nvidia GPUs starting in 2026.
Amazon does not currently sell its chips on the open market, offering them exclusively through AWS, which limits direct revenue comparisons with traditional chipmakers.
The chip business sits inside an accelerating cloud unit, with AWS revenue growing 28% in the first quarter of 2026 to reach $37.6 billion, which Jassy called the segment’s fastest growth in 15 quarters.
AWS generated $14.2 billion in operating income in the first quarter, up 23% from $11.5 billion in the same period a year earlier.
The investment required to sustain that growth is substantial, with Amazon expecting roughly $200 billion in capital expenditures across the company in 2026, and free cash flow for the trailing 12 months falling to $1.2 billion from $25.9 billion a year earlier.
Amazon’s stock traded at around $255 per share, or approximately 30 times earnings, though that figure includes a $16.8 billion pre-tax gain on the company’s Anthropic investment booked in the first quarter.
