Amazon.com Inc. (AMZN) shares climbed approximately 2.4% in Thursday afternoon trading, reaching a high of $245.72 before settling at $243.25. The move outpaced the broader market, with the S&P 500 ETF SPY gaining 0.8% and the Nasdaq-100 tracker QQQ also rising 2.4%.
The rally followed a Bloomberg Law report that Amazon is in discussions to sell its custom artificial intelligence chips to external data-center operators. This strategic pivot could position Amazon as a competitor in the AI chip market long dominated by Nvidia Corp. (NVDA), which also saw its shares rise about 2.5% on the day, suggesting investors do not view Amazon as an immediate threat.
Amazon's AI lead, Peter DeSantis, confirmed in an interview with Bloomberg Law that the company has initiated talks regarding AI infrastructure, though he declined to name potential customers. “AI infrastructure is rapidly evolving,” DeSantis said, adding that Amazon is exploring new ways to reach “more customers.” The move could transform Amazon's Trainium and related silicon from cost-saving tools for its cloud arm, Amazon Web Services (AWS), into a standalone revenue generator.
The chip sales initiative comes as Amazon prepares for its annual Prime Day event, scheduled for June 23-26. This marks a shift from the usual July timing, attributed to the World Cup and the U.S. 250th Independence Day celebrations. In 2025, the four-day sale generated $24.1 billion in U.S. online sales, according to Reuters and Adobe Analytics. The retail event will test consumer spending amid ongoing economic uncertainty.
AWS remains a critical focus for investors. At its New York summit this week, Amazon unveiled several new products targeting “agentic AI,” including AWS Continuum, AWS Context, Amazon Quick, and Bedrock AgentCore. These tools are designed to enable software to act and plan with reduced human intervention. Amazon reported that tasks run by agents on AgentCore surged 15-fold in the past six months.
Separately, WPP Enterprise Solutions announced a multi-year strategic collaboration with AWS to integrate generative and agentic AI into brand operations. WPP CEO Jeff Geheb noted that clients are eager to move AI “from experiments into operating systems.”
Amazon’s most recent quarterly results showed AWS sales jumping 28% to $37.6 billion, with CEO Andy Jassy describing it as the “fastest growth in 15 quarters.” The company’s chip business reached a $20 billion revenue run rate, though free cash flow dropped to $1.2 billion as AI-related capital expenditures increased.
Investors are weighing multiple narratives: the potential of chip sales, the promise of agentic AI, and the impact of heavy spending on free cash flow. If Prime Day disappoints or AI spending outpaces demand, Thursday’s gains could prove temporary. U.S. markets will be closed Friday, June 19, for Juneteenth.
