Amazon in Early Talks for $10B OpenAI Investment

Amazon is in early discussions to invest at least $10 billion in OpenAI, the artificial intelligence company behind ChatGPT, as part of a broader partnership that would involve the AI firm adopting Amazon's custom chips and expanding its use of cloud computing services.

The talks, which began around October following OpenAI's corporate restructuring, remain preliminary and fluid, with the exact investment amount still under negotiation, according to sources familiar with the matter. If finalized, the deal could value OpenAI at more than $500 billion, further boosting its rapid ascent in the generative AI sector. OpenAI would commit to using Amazon's Trainium chips for training AI models, positioning them as an alternative to dominant hardware from Nvidia. The chips, developed by Amazon Web Services since around 2015, are designed to handle intensive AI computations more cost-effectively than Nvidia's graphics processing units, according to Amazon.

This potential investment builds on an existing $38 billion agreement signed in November, under which OpenAI will rent server capacity from Amazon Web Services over the next seven years. The partnership underscores the surging demand...