Amazon Web Services Accelerates Global Data Center Expansion to Meet AI Demand

AWS Expands Global Data Center Footprint

Amazon Web Services (AWS), the world's largest provider of cloud computing services, is embarking on an aggressive expansion of its global data center network. Matt Garman, CEO of AWS, revealed in a Bloomberg Television interview that the company has recently opened a cluster of data centers in Mexico and is constructing new facilities in Chile, New Zealand, Saudi Arabia, and Taiwan 1 2.

Source: Bloomberg Business

This expansion is part of AWS's strategy to meet the surging demand for cloud computing and artificial intelligence (AI) services. As of early 2025, AWS operated 114 availability zones with plans for 12 more across 36 global regions, serving 245 countries and territories 3.

Boosting AI Capabilities with Nvidia Partnership

In addition to expanding its physical infrastructure, AWS is intensifying its focus on AI capabilities. The company is working closely with Nvidia to increase its stock of the latest GB200 semiconductors, which are now available for AWS customers to test 1 4. This move aims to enhance AWS's capacity to handle AI tasks and maintain its competitive edge in the rapidly evolving cloud services market.

Significant Investment in AI Infrastructure

AWS's commitment to AI is further evidenced by its substantial investments in infrastructure. In January 2025, the company announced plans to invest at least $11 billion in Georgia to expand infrastructure supporting cloud computing and AI 3. Roger Wehner, vice president of economic development at AWS, emphasized the company's "relentless commitment to powering our customers' digital innovation through cloud and AI technologies" 3.

Market Outlook and Competition

The server market is projected to reach $1.3 trillion by 2028, according to IDC 3. AWS faces stiff competition from other major players like Microsoft, Google Cloud, Digital Realty, and Equinix in the race to build and expand data centers capable of handling the intense computational power, data storage, and energy requirements of AI applications 3 4.

Source: Benzinga

OpenAI Partnership Potential

Garman expressed interest in hosting OpenAI's models on AWS, signaling potential new partnerships in the AI space. This comes after OpenAI, which currently uses Microsoft servers, received approval to explore other partnerships if Microsoft chooses not to continue their business arrangement 4.

Financial Projections

Amazon's AI franchise is expected to generate multiple billions of dollars in revenue over a full year, based on customer usage of AWS's on-demand AI services 4. This projection underscores the significant financial potential of AWS's AI-focused expansion strategy.

Industry Challenges and Concerns

Source: PYMNTS

Despite the optimistic outlook, the industry has faced some challenges. In April 2025, Wells Fargo analysts reported that Amazon had paused some of its data center leasing talks, particularly in international markets, following a similar move by Microsoft 2. However, executives from both Amazon and Nvidia have since dismissed concerns about a potential slowdown in AI data center construction 2.

As traditional data centers and power grids struggle to accommodate the demands of AI, the need for specialized AI data centers continues to grow 3. AWS's aggressive expansion and focus on AI capabilities position the company at the forefront of this evolving landscape, ready to meet the increasing demand for advanced cloud and AI services.