Amazon's $25B Chip Business Flying Under the Radar
Amazon's custom silicon business has been flying under the radar, but top investors are taking notice. The company's chip business runs at an annualized rate of $25 billion and is growing triple digits.
This growth is largely driven by AWS, which grew 36.7% year over year in Q2 FY2026, the fastest growth in 18 quarters. CEO Andy Jassy has framed AWS as capable of becoming a trillion-dollar annual revenue business for Amazon 'in time'.
The company's Trainium and Graviton chips are being used by top customers, including Anthropic and OpenAI, with more than $25 billion in annualized revenue generated from these custom silicon operations. However, the risk is that Amazon must spend roughly $200 billion this year to satisfy an AI demand curve that remains difficult to forecast.