AMZN: Amazon Stock Jumps 4% to Record High After $38 Billion Computing Deal with OpenAI

Amazon’s time to shine has come — after it largely missed the AI wave this year, the cloud company’s stock is finally making some solid moves.

📈 Long-Awaited AI Win

• Amazon stock AMZN surged 4% Monday to close at a record high of $254, giving the company a market value of $2.7 trillion.
• It’s a breakout that’s been months in the making, as investors had largely viewed Amazon as late to the artificial-intelligence party.
• The catalyst was a $38 billion cloud computing agreement with OpenAI, announced Monday, marking the tech firm’s largest AI-related deal to date.
• The contract — spanning seven years — places Amazon Web Services (AWS) in the AI infrastructure race.

💽 Smaller Deal, Big Signal

• OpenAI will use hundreds of thousands of Nvidia GPUs hosted inside AWS data centers to power ChatGPT and future AI models, Amazon said in a statement.
• “AWS’s leadership in cloud infrastructure combined with OpenAI’s pioneering advancements in generative AI will help millions of users continue to get value from ChatGPT,” Amazon noted.
• OpenAI CEO Sam Altman called the move a way to “strengthen the broad compute ecosystem” — code for diversifying away from Microsoft and ensuring OpenAI has enough horsepower to keep training its ever-larger models.

💰 What It Means Going Forward

• The $38 billion AWS partnership is modest compared to OpenAI’s recent commitments — including $250 billion to Microsoft’s Azure and $300 billion to Oracle Cloud — but symbolically, it’s pretty big.
• Amazon has lagged behind when it comes to AI leadership, with investors focused on the company’s e-commerce slowdown and logistics costs. Monday’s news flipped that narrative on its head.
• The deal also aligns Amazon more closely with OpenAI’s commercial success, potentially leading to future integrations with AWS tools or Alexa’s long-awaited AI revamp. And, what’s more, the breakthrough comes after a stellar quarter.