In the third quarter of 2024, AWS reported impressive financial results, generating $27.5 billion in sales, a 19% increase year-over-year, and an operating income of $10.4 billion.

Year to date, Amazon has already invested $51.9 billion, with expectations to increase spending further in 2025 due to rising demand for generative AI.

This substantial investment will primarily support Amazon Web Services (AWS), particularly in enhancing its cloud computing infrastructure and AI capabilities.

He described the potential for generative AI as a once-in-a-lifetime opportunity, expecting it to yield significant returns similar to past investments.

During an analyst call on October 31, 2024, Amazon CEO Andy Jassy announced a bold investment strategy focused on artificial intelligence (AI), projecting capital expenditures of $75 billion for the upcoming year.

Despite challenges in chip availability, Jassy noted that demand for AWS's AI solutions is outpacing supply, particularly for their new Trainium2 machine learning chip.

Jassy highlighted that AWS's AI business is experiencing triple-digit year-over-year growth, significantly outpacing the growth rate of AWS during its early stages.

Recent AI service launches, including Bedrock and proprietary AI chips like Inferentia and Trainium, are projected to generate multi-billion dollar revenues this year.

Jassy expressed confidence that Amazon's history of responsible spending would lead to successful returns on investments in generative AI, describing it as a unique opportunity.

Despite Nvidia's market dominance, Jassy expressed optimism about AWS's in-house AI chips, emphasizing their affordability as a competitive advantage.

Jassy also pointed out that more enterprises are expanding their cloud presence, citing recent partnerships with major companies such as ANZ Banking Group and Toyota.

To support its expanding cloud services, Amazon currently operates 353 datacenters across 38 markets and is constructing an additional 45 sites.