Amazon CEO Andy Jassy’s annual shareholder letter reads something like a Kendrick Lamar diss track, if the rapper was a corporate-speak-talking CEO and not a poetic Pulitzer-prize winning musician.
Meaning, you have to know the history to understand all of the competitors Jassy takes aim at, alongside cute personal stories about his unrealized dream of being a sportscaster and watching hockey games with his dad.
Of course, Jassy doesn’t throw the gauntlet down directly. He takes a more nuanced approach. For instance, in his challenge to Nvidia, he writes, “We have a strong partnership with NVIDIA, will always have customers who choose to run NVIDIA” and will always support these chips in its cloud.
But he also says: “Virtually all AI thus far has been done on NVIDIA chips, but a new shift has started.” AWS customers, he says, “want better price-performance” meaning Amazon’s own home-grown Trainium AI chips.
Jassy says demand is so high for this chip that capacity for the newest one, Trainium3, is nearly sold out. Remarkably, he says that capacity is also nearly sold out for Trainium4, which is still 18 months away from being available.
This means that Amazon’s chip business has hit a $20 billion annual revenue run rate. But if Amazon were a chipmaker that sold its wares to others, it would be at $50 billion ARR, he postulates.
Granted, Nvidia did $215.9 billion in actual revenue last year. Nvidia may not be shaking in its boots, yet. Still, Jassy presents Trainium as a formidable up-and-comer.
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Jassy didn’t spare Intel either. He points out that AWS’s homegrown Graviton CPU, a competitor to the Intel x86 architecture, “is now used expansively by 98% of the top 1,000 EC2 customers,” aka some of the biggest companies in the world. Two companies even asked to “buy all of our Graviton instance capacity in 2026,” he writes (emphasis his). “We can’t agree to these …