Amazon in talks to invest up to $50B in OpenAI

This article first appeared on GuruFocus.

Amazon (AMZN, Financials) is reportedly in early discussions to invest as much as $50 billion in OpenAI, the company behind ChatGPT, according to sources familiar with the matter. The move would make Amazon one of OpenAI’s biggest backers as the AI startup seeks up to $100 billion in new funding.

According to reports, CEO Andy Jassy is personally negotiating with OpenAI’s Sam Altman. This shows how important AI has become to Amazon’s long-term plans. The corporation has already put nearly $8 billion into Anthropic, a competing AI company, and it is still growing its own generative AI capabilities through Amazon Web capabilities.

If the transaction goes through, it would give Amazon a stronger position versus Microsoft, Nvidia, and Google, all of which are spending more on AI to build the next generation of computing infrastructure.

There have also been suggestions that OpenAI would go public, which could give the business a value of close to $1 trillion.