CNBC reports that Amazon is in early talks to invest up to $10 billion in OpenAI in a deal that would see its AI lab use the e-commerce giant’s AI chips.
If a deal goes through, the deal would value OpenAI at more than $500 billion, Bloomberg reported, citing unnamed sources. The Information was first to report on this matter.
Amazon is looking to diversify its bets in the AI race, partnering with OpenAI rival Anthropic and investing $8 billion so far. Earlier this month, the company also announced the latest version of its Trainium series of chips and outlined the development of the next generation of these chips to complement its cloud computing services through Amazon Web Services.
News of the deal comes months after OpenAI completed its transition to a for-profit model, giving the company more freedom to strike deals with investors other than Microsoft, one of its early backers with a 27% stake.
Amazon’s investment in OpenAI will be the latest in a series of circular deals in the AI space. Big hardware manufacturers and cloud providers are signing deals with young AI companies to use their products, while startups are committing to using their data centers and chips to train AI models.
In March of this year, OpenAI invested $350 million in stock in CoreWeave, which used the funds to buy chips from backer Nvidia. These same chips provide computing to OpenAI, increasing CoreWeave’s revenue and ultimately increasing the value of OpenAI’s stock. Then, in October, OpenAI signed a deal to acquire a 10% stake in AMD, promising to use the chipmaker’s AI GPUs, and in the same month also signed a chip usage agreement with Broadcom. And in November, the ChatGPT maker signed a $38 billion cloud computing deal with Amazon.
OpenAI and Amazon did not respond to requests for comment.
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