Amazon Tests AI Chips in Texas Lab to Reduce Nvidia Dependency

Amazon Tests AI Chips in Texas Lab, Aims to Cut Nvidia Costs - Amazon.com (NASDAQ:AMZN)

AWS saw a 17% revenue surge, controlling a third of the cloud market. Amazon.com Inc AMZN is making significant strides in artificial intelligence with its homegrown AI chips. In its Austin, Texas, chip lab, Amazon engineers are rigorously testing a new server design that features these AI chips, aiming to reduce reliance on Nvidia Corp's NVDA costly chips, Reuters reports. Amazon's efforts align with similar initiatives by rivals Microsoft Corp MSFT and Google parent Alphabet Inc GOOG GOOGL. Also Read: Nvidia Dominates GPU Market as Generative AI Adoption Grows, Analyst Says Rami Sinno, director of engineering for Amazon's Annapurna Labs, highlighted the growing customer demand for more affordable alternatives to Nvidia. Annapurna Labs, acquired by Amazon in 2015, is integral to this development. Amazon has been developing its Graviton chips, which perform non-AI computing tasks, for nearly a decade. The latest AI chips, Trainium and Inferentia, offer significant cost savings. "The offering of up to 40%, 50% in some cases of improved price and performance means it should be half as expensive as running that same model with Nvidia," said David Brown, Vice President of Compute and Networking at AWS, according to Reuters. Sales at AWS, which accounts for almost 20% of Amazon's total revenue, grew by 17% to $25 billion in the January-March quarter compared to the previous year. AWS holds approximately one-third of the cloud computing market, with Microsoft's Azure at about 25%. Analysts view Nvidia as the primary beneficiary in the AI sector. Mizuho Securities reports that Nvidia controls 70% to 95% of the market share for artificial intelligence accelerators. The Big Tech trio -- Google, Microsoft, and Amazon -- along with Oracle Corp ORCL -- contribute more than 40% of Nvidia's revenue. Amazon stock gained over 40% in the last 12 months, reaching a market cap of $1.87 trillion. Nvidia stock surged over 147% in the last 12 months and currently has a market cap of $2.76 trillion. Investors can gain exposure to the stocks through SPDR S&P 500 SPY and iShares Core S&P 500 ETF IVV. Price Action: AMZN shares traded higher by 1.47% at $182.50 premarket at the last check on Friday. Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Photo by Sundry Photography via Shutterstock Market News and Data brought to you by Benzinga APIs

Amazon Tests AI Chips in Texas Lab, Aims to Cut Nvidia Costs - Alphabet (NASDAQ:GOOG), Amazon.com (NASDAQ:AMZN)

Amazon.com Inc AMZN is making significant strides in artificial intelligence with its homegrown AI chips. In its Austin, Texas, chip lab, Amazon engineers are rigorously testing a new server design that features these AI chips, aiming to reduce reliance on Nvidia Corp's NVDA costly chips, Reuters reports. Amazon's efforts align with similar initiatives by rivals Microsoft Corp MSFT and Google parent Alphabet Inc GOOG GOOGL. Don't Miss: Here's the AI-powered startup that turns traders into influencers achieving 12% monthly growth - invest in it at only 10 cents per share. Don't miss out on the next Nvidia - you can invest in the future of AI for only $10. Rami Sinno, director of engineering for Amazon's Annapurna Labs, highlighted the growing customer demand for more affordable alternatives to Nvidia. Annapurna Labs, acquired by Amazon in 2015, is integral to this development. Trending: Don't miss the real AI boom - here's how to use just $10 to invest in high growth private tech companies. Amazon has been developing its Graviton chips, which perform non-AI computing tasks, for nearly a decade. The latest AI chips, Trainium and Inferentia, offer significant cost savings. "The offering of up to 40%, 50% in some cases of improved price and performance means it should be half as expensive as running that same model with Nvidia," said David Brown, Vice President of Compute and Networking at AWS, according to Reuters. Sales at AWS, which accounts for almost 20% of Amazon's total revenue, grew by 17% to $25 billion in the January-March quarter compared to the previous year. AWS holds approximately one-third of the cloud computing market, with Microsoft's Azure at about 25%. See Also: America's construction sites are desperate for Robots -- here's how to invest in a house-printing startup who's making them and be a part of a $16 trillion industry. Analysts view Nvidia as the primary beneficiary in the AI sector. Mizuho Securities reports that Nvidia controls 70% to 95% of the market share for artificial intelligence accelerators. The Big Tech trio -- Google, Microsoft, and Amazon -- along with Oracle Corp ORCL -- contribute more than 40% of Nvidia's revenue. Amazon stock gained over 40% in the last 12 months, reaching a market cap of $1.87 trillion. Nvidia stock surged over 147% in the last 12 months and currently has a market cap of $2.76 trillion. Investors can gain exposure to the stocks through SPDR S&P 500 SPY and iShares Core S&P 500 ETF IVV. Price Action: AMZN shares traded higher by 1.47% at $182.50 premarket at the last check on Friday Morning. Read Next: When today's AI startups go public, most of the rapid growth will be behind them -- here's how not to get left out. A billion-dollar investment strategy with minimums as low as $10 -- you can become part of the next big real estate boom today. Market News and Data brought to you by Benzinga APIs

How Amazon is planning to reduce its reliance on Nvidia's AI chips - Times of India

Amazon is working to develop its own AI chips in a bid to reduce its reliance on Nvidia's processors, a report said, noting that with this chip, the e-commerce giant aims to help customers compute complex calculations and process huge amounts of data in an affordable manner. Citing Amazon executive Rami Sinno, news agency Reuters reports that Amazon's chip lab in Austin, Texas, has a server that is packed with Amazon's artificial intelligence chips that compete with those from market leader Nvidia. Why Amazon is making its own AI chips Amazon is working on creating its own AI chips to reduce its dependence on Nvidia's 'high-priced' processors. These Nvidia chips are currently used to support the AI operations of Amazon Web Services, which is a major revenue source for the company. Sinno, the director of engineering for Amazon's Annapurna Labs that is a part of its cloud business AWS, told the news agency that Amazon's customers have been increasingly demanding more affordable alternatives to Nvidia's chip. "So the offering of up to 40%, 50% in some cases of improved price (and) performance - so it should be half as expensive as running that same model with Nvidia," said David Brown, Vice President, Compute and Networking at AWS. The report said that while the company's AI chip efforts are in a nascent stage, Amazon's Graviton - another chip that performs non-AI computing, has been under development for about a decade and is on its fourth generation. Reportedly, Amazon deployed a quarter million Graviton chips and 80,000 of its custom AI chips during its recent Prime Day event to handle the surge in activity across its platforms. Notably, Amazon is not the only tech giant company that is developing its own AI chips. Its cloud rivals Microsoft and Alphabet are also working on their own versions of AI chips. Meanwhile, in China, local players have started to develop AI chips to meet the requirements. The TOI Tech Desk is a dedicated team of journalists committed to delivering the latest and most relevant news from the world of technology to readers of The Times of India. TOI Tech Desk's news coverage spans a wide spectrum across gadget launches, gadget reviews, trends, in-depth analysis, exclusive reports and breaking stories that impact technology and the digital universe. Be it how-tos or the latest happenings in AI, cybersecurity, personal gadgets, platforms like WhatsApp, Instagram, Facebook and more; TOI Tech Desk brings the news with accuracy and authenticity.

Amazon 'Relatively Insulated' In Retail Segment, Analysts Bullish About Growth In AWS: AI Contribution To Watch Out For - Alphabet (NASDAQ:GOOG), Amazon.com (NASDAQ:AMZN)

Analysts at Wedbush Securities have sounded an optimistic note about Amazon.com Inc.'s AMZN prospects, thanks to its performance in the retail segment. They are also bullish on Amazon's rising operating margins, growth of the Amazon Web Services business, and AI monetization. What Happened: Ahead of Amazon's second-quarter results, scheduled to be released on Aug. 1, Wedbush analysts have laid out their bull thesis for the company with a price target of $225 in 12 months. The analysts are confident in Amazon's position within their coverage group and have maintained an Outperform rating for the company. Wedbush expects AWS growth of over 18% year-over-year in the second quarter, above the consensus of over 16.9%. "During the call, we will be listening for commentary related to AI's contribution to AWS as well as the broader business," analysts wrote. Amazon's AWS growth accelerated by 400bps in the last quarter, and a modest acceleration is expected in the second quarter. The analysts view the strength of Alphabet Inc.'s GOOG GOOGL Google's Cloud segment as a positive sign for AWS. The analysts are closely monitoring several key factors, including the retail segment's performance, the growth of AWS, and the company's AI monetization. They have also highlighted the potential impact of capital expenditure requirements to support infrastructure and AI investments. Despite some concerns about Amazon's second-quarter revenue guidance and recent questions about Prime Day results, analysts believe that Amazon is relatively insulated from recent competitive threats and continues to gain market share in the retail and e-commerce sectors. "While investor sentiment is broadly positive, we think weak 2Q revenue guidance and more recent questions surrounding Prime Day results early in 3Q have reignited debates related to eCommerce competition." "We believe slowing retail segment growth in 2Q is primarily macro and comp driven this quarter rather than a symptom of larger competitive issues, and our survey work supports our view that Amazon is relatively insulated from recent competitive threats and continues to gain market share of retail and eCommerce," the analysts wrote. See Also: Tesla Bull Cathie Wood's Ark Invest Buys $7.16M Worth Of EV Maker's Shares After Q2 Earnings Reveal Profits Tanked Sharply Why It Matters: Amazon's recent strategic moves further underscore its growth trajectory in the cloud and advertising sectors. Earlier in July, multiple analysts, including Wolfe Research's Shweta Khajuria, predicted an upside for Amazon stock in second-quarter earnings. Khajuria's bull case centers around AWS growth acceleration, margin expansion, and retail share gains. As the second-quarter earnings season approached, JPMorgan analyst Doug Anmuth highlighted Amazon as a top pick, alongside Uber Technologies Inc. and Google. Despite concerns about consumer spending slowdowns, Anmuth remains optimistic about these large-cap names. In June, Amazon disclosed plans to invest billions in Taiwan over the next 15 years to establish data centers, expanding its global footprint in Asia. Price Action: Amazon stock closed at $179.85 on Thursday, down 0.54%. In after-hours trading, the stock rose 0.24%. Year to date, Amazon has gained 19.96%, according to data from Benzinga Pro. Read Next: Tesla Earnings Are Imminent; These Most Accurate Analysts Revise Forecasts Ahead Of Earnings Call Image Via Shutterstock Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Market News and Data brought to you by Benzinga APIs