Amazon CEO Andy Jassy was interviewed on Mad Money by CNBC host Jim Cramer in Seattle, Washington. December 6, 2023.
CNBC
Amazon Chief Executive Andy Jassy sought to reassure investors who may be worried about future returns from the company’s massive investment in generating artificial intelligence.
During a conference call with analysts about the company Third quarter earnings report On Thursday, Jassy pointed to the success of Amazon’s cloud computing business, Amazon Web Services, which has become an important profit engine despite the high cost of building data centers.
“I think we’ve proven over time that we can bring in enough operating income and free cash flow to make this a very successful return on investment capital business,” Jassy said. “We expect generative labor The same thing happens with wisdom.”
Amazon spend Property and equipment expenses for the quarter were $22.6 billion, an increase of 81% from the same period last year. Jassy said Amazon plans to spend $75 billion in capital expenditures in 2024, and this number is expected to be higher in 2025.
Jassy said the growth in spending was primarily driven by investments in generative artificial intelligence. The company is rushing to invest in data centers, network equipment and hardware to meet the huge demand for the technology.
“This is truly a very large opportunity, perhaps a once-in-a-lifetime opportunity,” Jassy said. “I think our customers, the business and our shareholders will be pleased with the long-term goals that we are aggressively pursuing.”
Artificial intelligence spending is a key topic on this week’s technology earnings call. Yuan Wednesday Improved capital expenditure guidanceCEO Mark Zuckerberg said he was “very pleased” with the team’s execution. at the same time, MicrosoftInvestment in OpenAI aggravated The company, which reported fiscal first-quarter earnings on Wednesday, said capital spending will continue to increase. One day ago, Alphabet Chief Financial Officer Anat Ashkenazi warn The company expects capital expenditures to grow in 2025.
Amazon said its cloud unit has gained more business from companies that need infrastructure to deploy generative artificial intelligence models. The company has also launched a variety of artificial intelligence products in recent months for businesses, third-party sellers and advertisers on its marketplace. company expected to be announced Jassy said an enhanced version of the Alexa voice assistant will be launched “in the near future” that incorporates generative artificial intelligence.
Amazon hasn’t disclosed its generative AI revenue, but Jassy said Thursday that it has become a “billion-dollar revenue” business within AWS and “continues to grow at triple-digit year-over-year percentages.”
He added: “As AWS itself evolves, it’s growing more than three times as fast at this stage of its evolution, and we feel like AWS is growing pretty fast.”
