Amazon.com, Inc. (NASDAQ:AMZN) and NVIDIA Corporation (NASDAQ:NVDA) announced an expanded deal on August 26 that will bring an additional 2 million Nvidia GPU processors to Amazon data centers, building on AWS's earlier plan to add more than 1 million NVIDIA GPUs starting in 2026. The new processors, which include NVIDIA's Blackwell Ultra, Rubin and Rubin Ultra GPUs, are expected to arrive in Amazon Web Services data centers in 2027 and 2028.
The agreement goes far beyond simply purchasing more GPUs, with the expanded deal encompassing deeper collaboration across AI factories, CPUs, networking infrastructure, open models, data processing, and robotics, defining it as a larger infrastructure partnership instead of a single hardware order. That scale reflects how important the Amazon-NVIDIA partnership has become to both companies' AI strategies: NVIDIA Corporation (NASDAQ:NVDA) gains a massive buyer as the company targets more than $1 trillion in Blackwell and Rubin revenue through 2027, while Amazon.com, Inc. (NASDAQ:AMZN) secures the compute capacity required to continue scaling AWS's AI infrastructure business.
Notably, Amazon's increased NVIDIA order comes as the company expands its own competitive custom-silicon business. Amazon's internal chip range, which includes Trainium AI accelerators, Graviton CPUs, and Nitro networking chips, is reported to have reached a $25 billion annualized revenue run rate. Separately, Amazon says it has secured more than $225 billion in revenue commitments for Trainium, including major multi-year commitments from Anthropic and OpenAI.
The announcement's scale, with plans for more than 3 million total GPUs in a five-month period, reflects how swiftly AI infrastructure commitments have grown across the industry's major participants this year. The deal strengthens Amazon's position as one of NVIDIA's largest customers at a time when cloud providers are scrambling to secure chip supply years in advance. It will likely take until 2027 or 2028, when the newly ordered chips arrive, to determine whether that spending converts into the AI-driven cloud growth that investors are betting on.
Hedge fund ownership increased in both companies. Amazon.com, Inc. (NASDAQ:AMZN)'s ownership interest increased from 353 funds in the first quarter to 369 in the second, with Arrow Street Capital as its largest hedge fund shareholder through a $9.6 billion stake. NVIDIA Corporation (NASDAQ:NVDA) had a similar gain, from 275 to 285, with Fisher Asset Management as its top stakeholder at $18.1 billion, showing that both companies remain heavily held by institutional investors.
The case for Amazon.com, Inc. (NASDAQ:AMZN) is based on obtaining years of processor capacity at a time when AI infrastructure demand shows no signs of diminishing, offering AWS a clearer route to scaling its AI cloud business without supply restrictions becoming a bottleneck. The broader scope of the partnership suggests a developing strategic relationship rather than a one-off hardware purchase, and Amazon's concurrent buildout of its own Trainium and Graviton silicon shows that it's not wholly dependent on NVIDIA Corporation (NASDAQ:NVDA), giving it negotiating leverage and a hedge against future supply or pricing risk. Meanwhile, AWS's plan to deploy an additional 2 million NVIDIA GPUs adds visibility to demand, supporting the company's own outlook of $1 trillion in Blackwell and Rubin revenue by 2027.
The case for caution begins with the scale and duration of the investment. The chips won't arrive until 2027 and 2028, so any AI-driven growth this deal is supposed to support is a long-term gamble rather than a short-term catalyst, and AI infrastructure need can shift drastically over that span. Amazon's expanding internal silicon business begs the longer-term question of how long its reliance on NVIDIA will last, as a company developing competitive chips has an incentive to reduce its reliance on external suppliers over time.
This broadened partnership highlights the amount of capital both companies are ready to spend for a multi-year AI infrastructure buildout. Amazon.com, Inc. (NASDAQ:AMZN) appears to be the clearer near-term beneficiary, obtaining both chip supply and validation of its AI cloud strategy, while NVIDIA Corporation (NASDAQ:NVDA) receives another major multi-year demand signal from one of the world's largest cloud providers. Investors in both companies should keep an eye on how AWS's AI infrastructure revenue trends as the new chips arrive in 2027, since that will be the clearest test of whether this commitment translates into real cloud growth. Investors should also keep note on how quickly Amazon's internal silicon business scales relative to its external NVIDIA purchases, as this will indicate how the balance of power in this partnership evolves over time.
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