Amazon CEO Andy Jassy is even more optimistic about the AI ​​opportunity

• Andy Jassy emphasized aggressive investments in AI in a conversation with analysts.
• Amazon plans to invest $75 billion and even more in 2025, mostly in cloud services.
• Amazon's AI services are growing rapidly and demand for AWS's AI chips is high.

Just when you thought Big Tech executives couldn't get more optimistic about AI, Amazon CEO Andy Jassy upped the ante on Thursday.

During a call with analysts, he described a number of attractive opportunities for Amazon and said the company would continue to invest “aggressively” in AI.

Amazon is on track to spend $75 billion on capital expenditures this year and will spend even more in 2025, the CEO added. The majority of this will be destined for the Amazon Web Services cloud unit.

“We have proven over time that we can generate enough operating income and free cash flow to make this business a very successful return on invested capital,” Jassy said. “And we assume that the same thing will happen here with generative AI. It’s a really unusually big, perhaps once-in-a-lifetime opportunity.”

Jassy's comments came after Amazon reported third-quarter results that largely beat Wall Street's expectations. Amazon shares rose about 6% in after-hours trading.

Amazon has launched a number of new AI services in recent years, including Bedrock, an AI development tool, the Rufus shopping agent, and homegrown AI chips called Inferentia and Trainium.

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These AI services are now on track to generate “multi-billion dollars” in revenue this year and are growing at “triple-digit percentages” year over year, Jassy said during the call. Amazon's AI business “is growing three times faster in its development phase than AWS itself,” he added.

AWS's in-house AI chip business has seen mixed results so far due to Nvidia's huge market share, BI previously reported. On Thursday, Jassy said he sees an “opportunity to improve over time” in this area because AWS's chips are more affordable than other offerings.

Customers recognize that training and inference of AI models “could become costly” and that AWS's AI chips can be priced “very compellingly,” the CEO explained.

In fact, he said customer demand was so strong that AWS had to reach out to its chip manufacturing partners twice to produce more of its AI chips, Jassy added.

“It's a very significant opportunity for us in the AWS space and it will be a very significant opportunity for customers,” Jassy said.

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