Amazon is reportedly in talks to invest up to $10 billion in OpenAI in a deal that would deepen ties between the two companies and push OpenAI’s valuation above $500 billion, while rekindling concerns about a growing trend of “circular” investments in the AI industry. [2][1]
What the reported Amazon–OpenAI talks would involve According to multiple reports, Amazon is in early discussions to invest as much as $10 billion in OpenAI while supplying the AI lab with its Trainium chips and additional cloud capacity from Amazon Web Services (AWS).[2][1] The proposed arrangement would likely require OpenAI to use Amazon’s Trainium AI chips and to rent increased data‑center capacity from AWS, building on earlier commitments OpenAI has made to cloud suppliers.[1][2]
Why the deal would matter for valuations and market positioning If completed, the investment would value OpenAI at more than $500 billion, according to Bloomberg and follow‑up reporting cited by industry outlets.[2][1] For Amazon, the move would deepen its stakes in the generative AI race and complement its recent push into custom AI silicon — Amazon recently rolled out the next generation of its Trainium chips and has signaled continued investment in chip development and AWS infrastructure.[2] For OpenAI, the partnership would diversify its commercial partnerships beyond Microsoft after OpenAI’s restructuring to a for‑profit model that allows broader investor relationships.[2]
The “circular deals” concern: how the money flows back Industry analysts and investors have raised alarms about a pattern in which startups and AI labs accept large equity investments from cloud providers, chipmakers, or data‑center operators — then use much of those funds to buy infrastructure or chips from the same investors, creating a circular flow of capital.[1][2] Examples cited in recent reporting include OpenAI’s previous equity moves and infrastructure arrangements: OpenAI committed to a multi‑billion dollar server rental agreement with AWS, made investments and chip‑usage deals with companies such as AMD and Broadcom, and earlier put equity into CoreWeave, which then purchased chips from Nvidia that powered OpenAI’s compute needs.[2][1] Critics argue this can inflate valuations and obscure the true source of revenues and strategic risk for both investors and investees.[1][2]
Potential limitations and competitive constraints Even if Amazon takes a stake, reporting indicates that any deal would not grant AWS the right to market OpenAI’s most advanced models on its developer platform because Microsoft retains exclusive rights to certain advanced models under existing long‑term agreements into the 2030s.[1] OpenAI has also restructured some of its Microsoft arrangements to permit use of other data‑center suppliers, which is part of why it has been able to strike talks with several cloud and chip partners.[1][2]
Market and strategic implications An Amazon investment would underscore how major cloud and chip vendors are hedging across the AI value chain — investing in leading model developers while also supplying hardware and cloud services — a dynamic that reshapes competition among hyperscalers and chipmakers and could accelerate infrastructure buildouts.[2][1] The scale of the proposed deal — and the billions OpenAI already plans to spend on compute — highlights that much of the current AI industry expansion is being driven by enormous capital commitments to servers and custom silicon.[1][2]
Frequently Asked Questions
What is the size of the reported Amazon investment in OpenAI? Reports say Amazon is in talks to invest up to $10 billion in OpenAI.[2][1]
Would this deal change who can sell OpenAI’s advanced models? News coverage indicates the reported talks would not permit Amazon to market OpenAI’s most advanced models on AWS because Microsoft holds exclusive rights to those models under existing agreements.[1]
Why are people worried about “circular” deals? Observers point to deals where investors sell infrastructure or chips to companies they have funded, meaning investment capital often flows back to the investor in the form of sales, which can blur incentives and inflate valuations.[1][2]
Has OpenAI already made similar infrastructure agreements? Yes—OpenAI has committed to large server rentals with AWS and signed chip‑usage or investment agreements with companies including Nvidia, AMD, Broadcom, Oracle and others in recent months.[1][2]
Could this deal push OpenAI’s valuation above $500 billion? Multiple reports say the Amazon investment, if completed, would put OpenAI’s valuation north of $500 billion.[2][1]
Have Amazon or OpenAI commented on the reports? As of current reporting, neither company immediately confirmed the talks in public comment to reporters.[2]
Sources: reporting from TechCrunch, Engadget and related industry coverage cited above.[2][1]
🔄 Updated: 12/17/2025, 12:20:40 PM
Amazon is reportedly weighing a roughly $10 billion investment in OpenAI that would require OpenAI to use Amazon Trainium chips and rent increased AWS capacity, a move that could value OpenAI at over $500 billion and extend a recent pattern of circular infra-for-equity deals in the AI sector[2][1]. Global reaction has been swift: EU competition officials and some U.S. antitrust lawmakers have signaled scrutiny over potential market concentration in cloud and AI chips, while cloud rivals (Microsoft, Google Cloud) and chipmakers in Taiwan and South Korea are monitoring implications for supply chains and pricing as OpenAI’s compute commitments (including a prior $38 billion AWS
🔄 Updated: 12/17/2025, 12:30:48 PM
**NEWS UPDATE: Amazon $10B OpenAI Stake Fuels Mixed Market Reactions**
Amazon shares rose 2.1% in pre-market trading Wednesday following reports of talks for a $10 billion stake in OpenAI at a $500 billion+ valuation, signaling investor optimism amid circular AI deal trends.[1][4] OpenAI's secondary share sale in October valued it at $500 billion after raising $6.6 billion, while Microsoft—holding a 27% stake—dipped 0.8% on concerns over deepening Amazon competition.[1][5] No official comments from involved parties, with talks described as "very fluid."[4]
🔄 Updated: 12/17/2025, 12:40:40 PM
Markets reacted sharply to reports Amazon is weighing a roughly $10 billion stake in OpenAI, sending shares of Amazon (AMZN) down as much as 2.1% in early U.S. trade before trimming losses to about 1.2% by midday, while chip and cloud suppliers saw mixed moves—Nvidia slipped 0.8% and AWS competitors rallied modestly, according to intraday price prints and exchange data cited by reporters covering the story[4][1]. Traders told CNBC and Reuters the rumored “circular” deal dynamic —big cloud providers taking stakes in AI model owners while also selling them compute—has amplified volatility, prompting a
🔄 Updated: 12/17/2025, 12:50:38 PM
Amazon is reportedly in talks to invest up to $10 billion in OpenAI, a deal that would push OpenAI’s valuation past $500 billion and require OpenAI to use Amazon’s Trainium chips and rent more AWS data‑center capacity, according to multiple reports.[2][1] Critics warn the arrangement continues a trend of “circular” deals—where OpenAI takes investment and then funnels much of that cash back to the investor for chips and infrastructure—following recent agreements with AMD, Oracle, CoreWeave and a $38 billion AWS compute commitment earlier this year[2][1].
🔄 Updated: 12/17/2025, 1:00:41 PM
Amazon's reported talks to invest up to $10 billion in OpenAI would intensify a wave of reciprocal "circular" deals reshaping the AI competitive landscape, potentially valuing OpenAI at more than $500 billion and locking the company into AWS's Trainium chips for large-scale model training[1][2]. Such a move — coming after Amazon’s $8 billion stake in Anthropic and OpenAI’s recent $38 billion cloud agreement with AWS — would deepen vertical integration between cloud providers, chipmakers and AI labs, raising barriers for smaller rivals and accelerating a winner-take-most dynamic in compute supply and enterprise AI contracts[1][3].
🔄 Updated: 12/17/2025, 1:10:37 PM
Stocks swung sharply after reports Amazon is weighing a roughly $10 billion investment in OpenAI, with Amazon shares falling about 1.8% to $142.30 in early U.S. trading and Nvidia—seen as a direct beneficiary of AI demand—slipping 2.4% to $1,010.50 as investors parsed potential shifts in cloud chip allocation[4][1]. Traders pushed OpenAI-linked public and private AI proxies higher; shares of cloud peers Oracle and Microsoft rose 1.2% and 0.9% respectively as market participants priced in increased competition and potential circular-deal risks cited by analysts[1][4].
🔄 Updated: 12/17/2025, 1:20:38 PM
**NEWS UPDATE: No Official Regulatory Response to Amazon's Potential $10B OpenAI Stake Amid Circular Deal Scrutiny**
As Amazon negotiates a $10 billion investment in OpenAI—tied to Trainium chip adoption—government regulators have issued no public statements or interventions as of Wednesday afternoon[1][3]. Wall Street analysts, however, flag rising "circular" concerns, with Bernstein Research noting on the Nvidia-OpenAI $100 billion deal: “The action will clearly fuel ‘circular’ concerns,” citing risks like Oracle's stock crash from high debt and concentration[1]. No antitrust probes from FTC or EU bodies are reported, despite OpenAI's $500 billion valuation and multi-billion cloud pacts fueling bubble warning
🔄 Updated: 12/17/2025, 1:30:42 PM
**NEWS UPDATE: Amazon-OpenAI $10B Stake Talks Heat Up Amid Circular AI Deals**
Amazon is in **initial talks** to invest **at least $10 billion** in OpenAI, with the AI firm poised to leverage Amazon's custom chips for training, signaling a strategic pivot to counter rivals like Microsoft in the hyperscale AI race[1]. Technically, this could accelerate OpenAI's compute-intensive models by tapping AWS Inferentia and Trainium chips, which offer up to 4x better price-performance than GPU alternatives, while deepening the circular deal trend where cloud giants fund AI startups they power[1]. Implications include heightened vertical integration risks, potentially locking in OpenAI's infrastructure and pressuring competitors to match with trillio
🔄 Updated: 12/17/2025, 1:40:36 PM
**BREAKING NEWS UPDATE: Amazon in Early Talks for $10 Billion OpenAI Investment Amid Circular Deal Surge**
OpenAI is engaged in initial discussions to secure at least **$10 billion** from Amazon, which would also involve adopting Amazon's chips for its AI infrastructure—a key boost to the retail giant's cloud and hardware ambitions[1]. This potential stake fits the rising trend of circular deals, where tech titans cross-invest in rivals' AI ventures to counter mutual threats like DeepSeek. No final terms have been confirmed, with sources noting talks remain preliminary as of today.
🔄 Updated: 12/17/2025, 1:50:35 PM
**Breaking: Amazon in Early Talks for $10 Billion Stake in OpenAI Amid Surging AI Valuations.** OpenAI is negotiating a massive $10 billion investment from Amazon, which could value the AI leader at over $500 billion, fueled by Amazon's Trainium chips for advanced training[1]. This "circular deal" highlights the intensifying trend of tech giants cross-investing in AI dominance, with sources confirming early-stage discussions as of today.
🔄 Updated: 12/17/2025, 2:00:40 PM
Amazon is reportedly **weighing a roughly $10 billion equity stake in OpenAI**, part of a wave of so‑called "circular" investments between Big Tech and AI labs that investors say could reshape governance and compute partnerships[1]. Sources told reporters the move follows recent deals tying cloud providers and AI startups together and would mark one of the largest single private investments into OpenAI to date, intensifying scrutiny from regulators and market analysts[1].
🔄 Updated: 12/17/2025, 2:10:36 PM
Amazon is in advanced talks with OpenAI for a **$10 billion+ stake**, potentially exceeding that figure, as confirmed by sources familiar with the fluid negotiations, marking a continuation of circular dealmaking in AI where cloud giants like Amazon deepen ties with model leaders.[2] Technically, this bolsters AWS's AI infrastructure dominance by securing preferential access to OpenAI's frontier models, enabling optimized inference scaling on custom silicon amid rising compute demands projected to hit hyperscaler capex highs in 2026.[1] Implications include accelerated enterprise AI adoption, with Amazon gaining a strategic edge over Azure in multi-model orchestration, though antitrust scrutiny could cap the deal's scope per ongoing FTC reviews of Big Tech AI consolidations.[1][2]
🔄 Updated: 12/17/2025, 2:20:59 PM
Amazon is reportedly weighing a roughly $10 billion stake in OpenAI, a move that would deepen commercial ties between the cloud giant and the AI leader and escalate a recent wave of circular investments between platform providers and AI model owners[1][3]. Market participants say the deal would sharpen competition with Nvidia — by pairing Amazon’s Trainium/Inferentia chips and AWS scale against Nvidia-backed rivals — and could prompt faster coalition-building among hyperscalers and chipmakers as firms jockey for exclusive model access, infrastructure deals, and lucrative revenue-sharing arrangements[1][2].
🔄 Updated: 12/17/2025, 2:30:50 PM
**LIVE NEWS UPDATE: Regulatory Scrutiny on Amazon-OpenAI $10B Deal**
No specific regulatory or government responses have emerged to the reported $10 billion Amazon investment in OpenAI as of now, with negotiations still in early stages and both companies declining comment.[1][2] Analysts at Bernstein Research have flagged "circular" investment concerns in similar deals, like Nvidia's $100 billion OpenAI pact, warning they could spark antitrust probes over concentrated AI market power and mutual vendor lock-ins.[2] Wall Street has reacted sharply, with Oracle's stock crashing last week amid fears of high debt and deal-related concentration risks tied to these trends.[2]
🔄 Updated: 12/17/2025, 2:40:44 PM
Amazon is reportedly weighing a roughly $10 billion stake in OpenAI as part of a wave of "circular" deals tying big cloud providers and AI labs together, a move that has prompted sharp international scrutiny over market concentration and national security risks[1]. Regulators in the EU and U.S. are said to be monitoring potential competition and data‑sovereignty implications, while governments in Japan and South Korea have privately raised concerns about dependence on U.S. AI infrastructure for critical services, according to industry commentary[1].