American multinational technology company is planning to invest more than $100 billion in AI by 2025, with the majority of that money going toward improving its AWS cloud services, according to CEO Andy Jassy.
Despite possible cost reductions, Amazon expects to spend $75 billion on AI in 2024, yet this investment represents a huge rise.
Significant sums of money are also being invested in AI by other tech firms, such as Microsoft, Meta, and Alphabet, with the goal of profiting from growing usage and emerging applications.
The amount is more than the company’s 2024 spending of over $83 billion, and Jassy had forecast in October that the company’s 2025 capital expenditures will surpass those of the previous year due mainly to the expansion of generative AI.
“We spent $26.3 billion in capex in Q4, and I think that is reasonably representative of what you expect an annualized capex rate in 2025,” Jassy said on call with investors after the company released its fourth-quarter earnings report. “The vast majority of that capex spend is on AI for AWS.”
Since OpenAI’s ChatGPT assistant was introduced in late 2022, generative AI has been increasingly popular, and Amazon has been scrambling to match this demand by investing in data centers, networking equipment, and hardware.