OpenAI Signs $38 Billion Agreement With Amazon

OpenAI has signed a $38 billion (£29 billion) deal with Amazon to use its cloud services, continuing its push to expand computing capacity. ChatGPT’s parent company has also struck more than $1 trillion worth of agreements this year with Oracle, Broadcom, AMD, and Nvidia. The new partnership reduces OpenAI’s dependence on Microsoft and underscores the soaring demand for computing power amid the AI boom.

Microsoft had long served as the backbone of OpenAI’s infrastructure, with the two companies maintaining an exclusive cloud agreement until January this year. After the deal was announced on Monday, Amazon’s stock hit a record high, boosting its market value by $140 billion (£106 billion), according to the BBC. Major AI firms are increasingly investing in one another, forming a web of partnerships now drawing scrutiny — with OpenAI at the centre of it.

OpenAI will begin using AWS immediately, reaching full capacity by late 2026, with further expansion expected through 2027 and beyond, according to Al Jazeera. Matt Garman, the chief executive of AWS, said OpenAI continues to push the limits of what’s possible and that Amazon’s infrastructure will serve as the backbone for its ambitions.

The race for computing power among AI companies has raised concerns about how such growth will be financed. Analysts at US investment bank Morgan Stanley estimate that global data-centre spending will approach $3 trillion between now and 2028, with about half of it driven by major US tech firms.