Developing AI technology is not cheap at all. It costs billions of dollars to train AI models, and this is why most of the major models being trained are from trillion-dollar companies. Amazon is one of those companies, it’s one of the firms injecting a ton of money into AI technology. According to a new report, Amazon plans to spend $100 billion on AI this year.
At this point, there doesn’t seem to be any way of getting powerful AI for cheap. Even DeepSeek’s claim of training R1 on only a couple million dollars was possibly false. We’re seeing increased spending from major tech companies because AI is supposedly the future.
Google, one of the top AI companies in the world is expected to spend a whopping $75 billion on AI this year, and Microsoft will go a few steps further with $80 billion. We can expect high numbers from other AI companies as they try to push the technology ahead.
Amazon will spend $100 billion on AI this year
The fact that Amazon will spend the equivalent of 719,424,460 months of Prime on AI is pretty surprising. Among the top tech brands working on AI, Amazon has the least to show for it. We haven’t seen many compelling or public-facing AI tools from the company. In late 2023, it spoke about updating Alexa with some generative AI smarts, but that hasn’t happened yet. So, it’s a bit odd that the company is spending more on AI this year than Google and Microsoft, companies that have established AI platforms.
In any case, it looks like the e-commerce giant wants to play catch-up. Amazon’s CEO spoke during an earnings call, and he hinted that the company may actually spend more than $100 billion on AI. So, we should, hopefully, see more progress on Alexa’s grand metamorphosis this year.
During the earnings call, Jassy also stated that, “The vast majority of that capex spend is on AI for AWS.” (capex standing for capital expenditure). This should come as no surprise, as Amazon spent $26.3 billion on AI in Q4 2024, and it expects that number to go up.
People who are excited about the future of Amazon’s AI might finally see it materialize. What we know is that Amazon is working on revamping Alexa. Also, we can’t forget about the company’s video generation model that it showed off last year. 2025 might be the year of Amazon AI.
