Amazon in Early Talks to Sell Trainium Chips
Amazon (NASDAQ: AMZN) is reportedly negotiating to sell its custom Trainium chips for use in other companies’ data centers, marking a significant shift from its previous strategy of only renting computing power through Amazon Web Services (AWS). The company’s custom-chip business surpassed a $20 billion annual revenue run rate in Q1 2026, indicating robust growth.
Key Developments and Customer Commitments
Peter DeSantis, Amazon’s AI chief, noted that discussions with potential buyers are in preliminary stages without a specified timeline for chip availability outside AWS. Major commitments include OpenAI, which has secured approximately two gigawatts of Trainium capacity, and Anthropic, which has signed on for up to five gigawatts. The demand for Trainium is strong enough that Amazon’s latest model, Trainium3, is nearly sold out.
Nvidia’s Position and Market Dynamics
Nvidia (NASDAQ: NVDA) continues to dominate the AI chip market, with its data center revenue rising 92% year over year to a record $75.2 billion in Q1 2027. While Amazon’s chip sales might introduce competition, experts believe the AI market can accommodate both companies. In fact, Amazon plans to deploy over one million Nvidia GPUs starting in 2026, showing a cooperative dynamic in an expanding market.
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