Amazon CEO Targets Nvidia, Intel, Starlink, and Others in Shareholder Letter

Amazon CEO Andy Jassy’s Bold Vision for the Future

In his recent annual shareholder letter, Amazon CEO Andy Jassy adopted a tone reminiscent of a Kendrick Lamar diss track—if the rapper had traded his lyrical prowess for corporate jargon. The correspondence is layered with competitive insights, personal anecdotes, and a robust defense of his strategic direction, appealing to shareholders in a way that blends business acumen with relatable storytelling.

Competitive Landscape

While Jassy doesn’t openly challenge his competitors, his nuanced commentary serves that purpose effectively. He references calm partnerships with companies like Nvidia. “We have a strong partnership with NVIDIA and will always support their chips,” Jassy notes, indicating a collaborative stance. However, he simultaneously hints at a forthcoming shift, stating, “Virtually all AI thus far has been done on NVIDIA chips, but a new shift has started.” This indicates Amazon’s intention to strengthen the position of its in-house Trainium AI chips in a market primarily dominated by Nvidia.

The Rise of Trainium Chips

Jassy’s assertion that demand for Trainium chips is skyrocketing is a focal point of his address. According to his estimates, the latest iteration, Trainium3, is nearly sold out, and Trainium4, which won’t even be available for another 18 months, is also approaching full capacity. With this intense interest, Jassy predicts that Trainium could achieve a remarkable $20 billion annual revenue run rate.

From a hypothetical standpoint, he suggests that if Amazon were to sell its chips widely, it could be looking at a staggering $50 billion annual revenue run rate. While Nvidia reported $215.9 billion in revenue last year, Jassy positions Trainium as a formidable contender poised for growth.

Challenging Intel with Graviton

Jassy didn’t stop at Nvidia; he also took aim at Intel. He highlighted the success of AWS’s in-house Graviton CPU, which competes with Intel’s x86 architecture. He proudly mentions that Graviton is used by 98% of the top 1,000 EC2 customers, some of the most significant players in the market. Uniquely, two companies even expressed interest in “buying all of our Graviton instance capacity in 2026,” emphasizing the high demand for Amazon’s offerings.

Expanding Horizons: Amazon Leo

Jassy’s letter also outlines Amazon’s ambitions in new territories, such as its plan to launch Amazon Leo, the company’s answer to Starlink, in mid-2026. He reveals that Amazon Leo has already secured contracts from various prominent organizations, including Delta Airlines, AT&T, and Nasa. This diversification signals Amazon’s drive to expand its portfolio beyond traditional e-commerce and into cutting-edge technologies.

The Future of Robotics

Another intriguing avenue mentioned by Jassy is the potential for Amazon to explore robotics. He suggests that the data collected from Amazon’s extensive fleet of 1 million warehouse robots could lead to the development of “robotics solutions” for both industrial applications and consumer use. This revelation hints at an exciting future where Amazon could unveil humanoid robots or advanced robotic solutions, further enhancing its technological prowess.

Major Capital Investments

A significant portion of Jassy’s letter focuses on ambitious capital expenditures. He announced a plan to invest around $200 billion in 2026 on capex to build out AWS data centers. This is more than any of its major competitors are investing, and it serves as a critical part of his pitch to shareholders, especially given the recent decline in Amazon’s stock, which dipped below $200 a share.

Jassy emphasizes, “We’re not investing approximately $200 billion in capex in 2026 on a hunch.” He supports this claim by referencing Amazon’s deal with OpenAI, where the model maker pledged to spend $100 billion on AWS. While skepticism about OpenAI’s ability to fulfill its commitments exists, Jassy assures shareholders that additional customer agreements—some completed and others in the pipeline—are set to boost AWS capacity further.

A Sustainable Future and Market Stability

As Jassy navigates the complex landscape of tech investments, he addresses some concerns regarding market sustainability. “I’ve followed the public debate on whether this technology is over-hyped, whether we’re in ‘a bubble,’” he writes. Here, he provides reassurance to stakeholders, stating that, for Amazon, the current state of affairs is not indicative of a bubble but rather a reflection of significant growth opportunities.

Conclusion: The Road Ahead for Amazon

Andy Jassy’s annual shareholder letter offers a comprehensive overview of Amazon’s bold plans, competitive strategies, and commitment to growth. By focusing on in-house innovations like Trainium and Graviton, expanding into new sectors like satellite communication, and contemplating robotics, he positions Amazon as a forward-thinking tech giant determined to reshape the landscape of technology.

While facing industry leaders such as Nvidia and Intel, Jassy’s articulate vision blends competitive spirit with a promise of sustainable success that could redefine Amazon in the years to come. It will be interesting to observe how these plans unfold as the technology landscape continues to evolve and as Amazon strives to leverage its resources strategically to maintain its position as a market leader.

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Emmanuel Kesse

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