Amazon Completes $50 Billion Investment in OpenAI

Amazon Completes $50 Billion Investment in OpenAI

Amazon completed a $50 billion investment in OpenAI that the two companies announced in February.

Amazon said in a Friday (July 31) filing with the Securities and Exchange Commission that after entering into the agreement and investing $15 billion during the first quarter, it invested another $13.7 billion in the second quarter and the remaining $21.3 billion of its commitment sometime after June 30.

OpenAI announced Feb. 27 that it raised new funding that included $50 billion from Amazon. The company said that as part of the deal, Amazon Web Services (AWS) would become the exclusive third-party cloud provider for OpenAI’s Frontier program and OpenAI would expand prior infrastructure agreements with AWS that could total $100 billion over eight years.

In its own Feb. 27 announcement of its investment in OpenAI, Amazon said the $50 billion investment would start with an initial $15 billion, which would be followed by another $35 billion within months “when certain conditions are met.”

The Information reported in February that those conditions could include whether OpenAI goes public or if it achieves artificial general intelligence (AGI), a term for AI that functions at the same level as humans.

In a Friday report that flagged Amazon’s SEC filing saying it completed the investment, The Information noted that OpenAI has not gone public and said that Amazon did not specify why it made the remaining investment.

It was reported Wednesday (July 29) that OpenAI’s flagship product, ChatGPT, is approaching 1 billion weekly active users. While this milestone came seven months later than the AI startup had initially projected, it made ChatGPT one of the fastest-growing apps in the history of the internet, as it achieved this scale in under four years.

On Thursday (July 30), OpenAI cut the price of two of its models and accelerated the performance of a third model while leaving its price unchanged. The company said that it made these changes to improve the models’ performance per dollar across enterprise workloads.

“We are building a resilient infrastructure portfolio and matching each workload to the systems best suited to run it,” OpenAI said in a blog post. “That approach supports both ends of the price-performance curve.”

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