OpenAI Inks $38 Billion Cloud Deal With Amazon Web Services

Multiyear agreement secures massive compute for AI models amid $1.4 trillion infrastructure push
OpenAI Inks $38 Billion Cloud Deal With Amazon Web Services
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OpenAI has signed a seven-year, $38 billion agreement to purchase cloud services from Amazon.com's Amazon Web Services.

The deal, announced on Monday, follows a restructuring last week that shifted OpenAI further from its non-profit origins and granted greater operational independence.

It provides immediate access to hundreds of thousands of Nvidia graphics processors for training and running artificial intelligence models.

All planned capacity will come online by the end of 2026, with options to expand in 2027 and beyond.

Amazon already hosts OpenAI's open weight models on its Bedrock platform.

Compute Expansion Drives Partnership

The agreement highlights the growing demand for computing resources in the artificial intelligence sector.

OpenAI chief executive Sam Altman has committed the company to spending $1.4 trillion to develop 30 gigawatts of computing capacity, equivalent to powering roughly 25 million U.S. homes.

"Scaling frontier AI requires massive, reliable compute," said Altman.

"Our partnership with AWS strengthens the broad compute ecosystem that will power this next era and bring advanced AI to everyone."

OpenAI will begin using AWS immediately.

The restructuring removed Microsoft's prior right of first refusal for compute services.

OpenAI has also secured cloud deals with Alphabet's Google and a $300 billion agreement with Oracle for approximately five years.

Last week, it agreed to buy $250 billion in Microsoft Azure services.

OpenAI's annualized revenue run rate is projected to reach about $20 billion by year-end, though losses continue to mount.

The company is preparing for a potential initial public offering that could value it at up to $1 trillion.

Amazon shares reached an all-time high on Monday, rising 5 percent and adding nearly $140 billion in market value.

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