When investors start getting jittery about AI valuations, the instinct is to trim anything tied to artificial intelligence. But that’s tricky when many of the biggest AI beneficiaries are mega-cap tech companies that were thriving long before generative AI existed. Amazon is a perfect example, a business still defined by eCommerce but increasingly central to the global AI build-out.
The real question isn’t whether Amazon touches AI but if the company deserves to be viewed as an AI stock at all, and what that means if the market eventually calls time on the AI boom.
Key Points
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AWS anchors Amazon’s AI push, boosted by its model-agnostic Bedrock platform and a massive OpenAI infrastructure deal.
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Amazon’s custom AI chips are gaining momentum, with Trainium adoption—especially by Anthropic, enhancing AWS economics.
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Amazon isn’t a pure AI bet, giving it AI upside without the valuation risk facing standalone AI stocks.
AWS Is The Center of Amazon’s AI Gravity
AWS still holds the top spot in cloud computing with about 29% market share, ahead of Azure (20%) and Google Cloud (13%). But Amazon’s AI strategy stands out for one reason: instead of pushing a single in-house model, AWS acts as a neutral AI marketplace through Amazon Bedrock. Customers can mix and match Amazon models with third-party options like Claude and Stable Diffusion.
That flexibility solves a major enterprise headache, no one wants to rebuild systems every time a new model hits the headlines.
Notably, OpenAI recently agreed to a $38 billion infrastructure partnership with Amazon, meaning AWS will support a significant amount of OpenAI’s future compute loads. Analysts already expect AWS to grow around 20% in 2026, and AI demand could drive that higher.
Amazon’s Hardware Play
While Nvidia dominates the AI chip narrative, Amazon has built its own silicon stack. The Trainium family of chips, optimized for AI training, helps AWS reduce dependence on third-party GPUs and improve margins. These chips now power Amazon’s high-density UltraServers, which are becoming a major draw for AI labs.
Anthropic, the company behind Claude, is expected to be running over a million Trainium chips by year-end. That’s a huge vote of confidence in hardware Amazon rarely gets credit for.
Retail Still Pays the Bills
Even with its AI advances, Amazon’s foundation remains eCommerce. In Q3, retail revenue topped $147 billion, dwarfing AWS’s $33 billion. AWS grew faster than retail, but its share of total revenue remains relatively small.
AWS has lost a bit of market share, not just to Azure and Google, but to AI-focused clouds like CoreWeave and Nebius. These challengers specialize in GPU-dense clusters and have picked up traction with AI labs needing customized setups. Still, Amazon’s global scale, distribution, and enterprise relationships remain unmatched.
Meanwhile, AI is quietly boosting Amazon’s retail engine. The company uses AI to optimize warehouse workflows, predict inventory movement, automate robotics, and personalize customer recommendations, each contributing incremental profit lift.
Is Amazon an AI Stock or Not?
Amazon benefits meaningfully from AI, but it’s not a pure-play AI business and that actually strengthens the investment case. Pure AI stocks trade at valuations that assume years of explosive growth; if sentiment turns, those names could see sharp pullbacks.
Amazon, on the other hand, trades at roughly 32x trailing earnings, supported by massive eCommerce and advertising businesses that provide stability. AWS gives Amazon long-term AI upside, but not the valuation risk of companies tied entirely to AI hype.
In short: Amazon isn’t an “AI stock.” It’s a diversified tech and retail powerhouse with growing AI leverage, exactly the kind of business that can benefit from AI without being hostage to it.