Amazon Weighs Selling Trainium AI Chips, Taking Aim at Nvidia
June 18, 2026
Amazon Web Services is in talks to sell its in-house Trainium AI chips to other companies for use in their data centers, Bloomberg reported. If it happens, it would be a rare move by a major cloud provider to compete more directly with Nvidia in AI chips.
Until now, Amazon has mainly kept Trainium inside AWS as cloud capacity for its own customers, where demand has outpaced supply.
AWS Confirms Early Talks to Sell Trainium
Peter DeSantis, Amazon’s AI chief, told Bloomberg that AWS is in discussions to sell its Trainium chips to third parties for use in data centers. He declined to name the buyers, and Amazon told TechCrunch the talks are in early stages.
The idea traces back to CEO Andy Jassy’s 2025 shareholder letter, published in April 2026. In it, Jassy said AWS’s chips business could run at roughly $50 billion a year if treated as a stand-alone business selling chips to AWS and third parties.
That business, which includes Graviton, Trainium, and Nitro, is already on a run rate above $20 billion and growing at triple-digit percentages year over year. Graviton is a CPU, and Nitro supports EC2 networking and virtualization, so not all of that revenue comes from AI accelerators like Trainium.
Why AWS Has Resisted Selling Its Chips
One reason is its revenue model. AWS does not just charge for the chips; running AI apps on its cloud also generates revenue from storage, networking, and security services, so keeping chips in its cloud widens the revenue base.
Supply is the other constraint. Per Jassy’s letter, Trainium2 offered about 30% better price-performance than comparable GPUs and has largely sold out.
Trainium3, which began shipping in early 2026, is 30 to 40% more price-performant than Trainium2 and nearly fully subscribed. Even Trainium4, which Jassy said in April was about 18 months from broad availability, is heavily reserved.
Selling to outsiders could push existing customers onto wait lists.
How Close Could $50 Billion Get to Nvidia?
A $50 billion business would not immediately threaten Nvidia. Annualizing its latest quarterly revenue of $81.6 billion implies about a $326 billion run rate, making $50 billion a fraction of that.
Even so, a cloud heavyweight entering this market head-on still matters.
Scaling up is the catch. Producing more chips means securing capacity at contract manufacturer TSMC, where Nvidia has reportedly surpassed Apple to become the biggest customer.
Nvidia is expanding too: CEO Jensen Huang has pointed to a new $200 billion TAM (total addressable market) in AI CPUs, beyond GPUs.
What to Watch Next
The talks are early, and no buyers have been named. Whether Amazon can secure enough supply for outside sales without sidelining its own AWS customers, and how much advanced-packaging capacity it can line up at TSMC and peers, will determine how real the plan becomes.
The $50 billion figure is a hypothetical from the letter; actual sales depend on the contracts that follow.
Sources
Amazon – Amazon CEO Andy Jassy’s 2025 Letter to Shareholders
NVIDIA – NVIDIA Announces Financial Results for First Quarter Fiscal 2027
Bloomberg – Amazon in Talks to Sell AI Chips Competing With Nvidia to Other Companies
TechCrunch – Amazon hopes to challenge Nvidia more directly by selling its AI chips
