Amazon NASDAQ:AMZN shares rose about 2.5% on Wednesday after Chief Executive Andy Jassy said demand for the company's custom artificial intelligence chips remains strong.
Jassy said customer interest in Amazon's Trainium chips has been "incredibly strong" as companies seek lower-cost alternatives for training and running AI models. He indicated the chips are designed to deliver better performance per dollar, making them an attractive option for enterprise customers using Amazon Web Services.
Amazon has been expanding its in-house semiconductor portfolio as competition intensifies among cloud providers seeking to reduce reliance on third-party chip suppliers. The company continues to position Trainium and Inferentia chips as part of its broader AI strategy while investing heavily in AWS infrastructure to support rising demand for generative AI services.
Amazon's AI push comes as AWS remains the company's largest profit driver despite slowing cloud spending in recent years. Alongside its e-commerce operations, Amazon has expanded into healthcare, grocery, robotics and autonomous driving, with management viewing artificial intelligence as a key long-term growth opportunity across multiple businesses.