Amazon in talks to invest $10 billion in OpenAI

Amazon.com Inc is in discussions to invest in OpenAI, the developer of ChatGPT, in a potential deal that could value the artificial intelligence company at more than $500 billion, a source familiar with the matter informed on Tuesday, according to a report by Reuters.

The talks come as OpenAI lays the groundwork for an initial public offering that could value the company at up to $1 trillion, Reuters had reported in October. Amazon may invest around $10 billion in OpenAI, although discussions between the two companies remain very fluid, the source stated, speaking on condition of anonymity as the matter is private, as per the Reuters report.

The approach underscores OpenAI’s growing ability to partner broadly after moving away from its non-profit roots and finalising its restructured deal with Microsoft, the source said. That agreement reshaped OpenAI into a public benefit corporation controlled by a non-profit entity that retains a stake in the company’s financial success, removing key constraints on OpenAI’s ability to raise capital and secure computing resources.

Microsoft holds a 27% stake in OpenAI and has exclusive rights to sell OpenAI’s models to its cloud customers. The Information, which first reported the talks with Amazon, said OpenAI plans to use Amazon’s Trainium chips, which compete with processors developed by Nvidia and Google.

OpenAI and Microsoft did not immediately respond to Reuters’ requests for comment on The Information report. The potential Amazon financing could also open the door to a broader fundraising round involving additional investors, The Information reported.

Separately, OpenAI is exploring the sale of an enterprise version of ChatGPT to Amazon, although it remains unclear whether any agreement would include provisions to integrate ChatGPT features such as AI-powered shopping tools that Amazon is developing for its own applications, the report added.