Amazon to invest up to $25 billion in Anthropic; AI firm commits to spend $100 billion on AWS in return

Amazon announced on Monday that it will invest up to $25 billion in Anthropic. As part of the deal, the AI firm has also committed to spending more than $100 billion over the next decade on Amazon's cloud technologies.

The deal signals one of the largest long-term collaborations in the rapidly intensifying AI race and deepens the two companies' relationship as Anthropic rushes to secure capacity to bolster its models. The announcement mentioned that Anthropic has secured up to 5 gigawatts of capacity for training and deploying its Claude AI models.

Seattle-based Amazon will invest $5 billion in Anthropic now, and up to an additional $20 billion in the future, tied to certain commercial milestones. This investment is in addition to the $8 billion Amazon previously invested in the company.

“Anthropic’s commitment to run its large language models on AWS Trainium for the next decade reflects the progress we’ve made together on custom silicon, as we continue delivering the technology and infrastructure our customers need to build with generative AI,” Amazon CEO Andy Jassy said in a statement.

Amazon doubles down on AI infrastructure and strategic bets

Amazon has struggled to generate widespread buzz around its in-house AI models, such as Nova, even as it continues to dominate the backbone of the AI boom through its cloud computing services. The company anticipates capital expenditures of around $200 billion this year, with a major portion directed towards scaling AI infrastructure, Reuters reported.

At the same time, Amazon is placing big bets on leading AI startups. Its latest investment in Anthropic, the creator of Claude, comes after Amazon unveiled earlier this year that it would invest up to $50 billion in OpenAI, the company behind AI chatbot ChatGPT. The two AI companies have been racing to convince investors of their strengthening positions ahead of potential IPOs that could happen as soon as this year.

In a statement recorded on Monday, Anthropic said that it expected to bring roughly 1 gigawatt of capacity via Trainium2 and Trainium3 chips by year-end, according to the news agency.

Rivals also invest in Anthropic

Founded in 2021 by former OpenAI researchers and executives, Anthropic has quickly emerged as one of the most prominent players in the generative AI space. The company is best known for its family of Claude models and has seen strong early traction among enterprise clients, with annualized revenue reportedly surpassing $30 billion, CNBC reported.

Anthropic named Amazon Web Services (AWS) its primary cloud provider in 2023 and, later in 2024, its main training partner, deepening its ties with Amazon. However, the company has not limited itself to a single ecosystem, signing additional agreements with rivals such as Microsoft and Google.

In November, Microsoft agreed to invest up to $5 billion in Anthropic, and the AI firm said it committed to purchase $30 billion of Azure compute capacity. Earlier this month, Anthropic expanded its partnerships with Google and Broadcom for “multiple gigawatts” of capacity, according to CNBC.

Anthropic aims to pull ahead in the AI race with model releases focusing on coding and design. Amazon, meanwhile, seeks customers for its custom silicon chips built for artificial intelligence training and inference. Amazon shares rose around 2.7% in extended trading after the announcement.

(With wire inputs)