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E-commerce and cloud computing giant Amazon (NASDAQ:AMZN) announced an additional $2.75 billion investment in Anthropic, an artificial intelligence (AI) startup that competes with OpenAI’s ChatGPT. The investment is part of a previous agreement in which Amazon committed to investing approximately $4 billion in Anthropic. Initially, Amazon invested $1.25 billion to strengthen his AI efforts and stay competitive with industry rivals such as Microsoft (NASDAQ:MSFT) and the alphabet (NASDAQ:Google).
Per the agreement, Anthropic is using Amazon Web Services (AWS) as its primary cloud provider to develop future foundation models (FM) and other critical workloads such as safety research. Additionally, the startup will use his AWS Trainium and Inferentia chips to build, train, and deploy FM. Anthropic also provides AWS customers with access to next-generation FM on Amazon Bedrock. Bedrock is a fully managed service on AWS that provides access to high-performance third-party FM for building generative AI applications.
AWS customers now have access to the most powerful Anthropic AI models as part of this strategic collaboration. AMZN highlighted that customers are leveraging his Amazon Bedrock to build generative AI applications using Anthropic’s Claude AI. Of particular note is Anthropic’s most intelligent model, Claude 3 Opus, which has demonstrated superior performance in several areas compared to other models, including his GPT-4 from OpenAI. . Gaining access to high-performance models from Anthropic and other companies on AMZN’s Bedrock could help boost AWS’s business and, in turn, its overall finances.
Amazon’s AI promotion
Amazon continues to invest in AI to strengthen its competitiveness and accelerate growth. The company introduced a specialized AI training chip called Trainium and an inference chip called Inferentia. Additionally, the company recently announced its next-generation training chip, Trainium2, which boasts 4x faster training performance and 3x more memory capacity than its predecessor.
The company is anthropic, cohere, meta (Nasdaq:Meta), Stability AI by Bedrock. Additionally, the company has developed its own LLM, Titan.
The company’s management remains optimistic about its AI efforts and expects its investments to generate billions of dollars in future revenue.
What are your predictions for Amazon stock?
Wall Street is bullish on Amazon’s prospects. 41 analysts cover the AMZN stock, and all recommend it as Buy. Amazon’s stock price has increased about 85% in one year. Analysts’ average price target for AMZN of $209.59 suggests an upside potential of 16.55%.
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