amazon, openai and nvidia Updates

Amazon Web Services (AWS) has secured a significant $38 billion cloud deal with OpenAI, spanning seven years, which will provide OpenAI with the computing power needed to train new AI models and run ChatGPT queries. This agreement positions AWS to supply all necessary capacity by the end of 2026, utilizing hundreds of thousands of Nvidia's specialized AI chips. OpenAI CEO Sam Altman noted the company's steeply growing revenue justifies such massive infrastructure investments. This deal marks a major win for Amazon, whose stock rose 5% to a record high, and helps AWS regain ground in the cloud market, where its share had previously dropped to 29% amidst competition from Microsoft and Google. Analysts anticipate this agreement will boost AWS's backlog by approximately 20% from $200 billion. Amazon, which had been perceived as an AI laggard, has significantly increased its AI spending, launched its own large language model called Titan, and opened an $11 billion AI data center in Indiana. Notably, Amazon also serves as the primary cloud provider for Anthropic, a rival to OpenAI, supporting it with a multibillion-dollar cloud campus. Across the tech industry, major players are pouring resources into AI; Microsoft, Alphabet, Amazon, and Meta collectively saw their capital expenditures jump 77% year-over-year to $112.5 billion last quarter, with Microsoft leading at $34.9 billion and Amazon closely behind at $34.2 billion. Amazon's CFO confirmed the company will continue substantial AI investments, projecting full-year capital expenditure around $125 billion, increasing in 2026. Beyond the cloud giants, other companies are also making significant AI strides. Palantir Technologies Inc. reported its best-ever quarterly results, driven by high demand for its artificial intelligence platform, with Q1 profit reaching $102.1 million on $635.3 million in revenue, a 21% year-over-year increase. Commercial revenue surged 42% to $267 million. Despite this strong performance and raised full-year revenue forecasts, Palantir's stock experienced a sell-off due to profit-taking and concerns over its high valuation, trading at over 200 times forward earnings. Shopify is heavily leveraging AI to drive e-commerce growth, particularly for the holiday season. Its AI digital assistant, Sidekick, saw over 750,000 merchants use it for the first time in Q3, leading to nearly 100 million interactions. Shopify, which partnered with OpenAI in September, reported Q3 revenue of $2.8 billion, exceeding estimates, and views AI as the biggest technology shift since the internet. CoreWeave, an AI cloud computing company, is also seeing strong demand, with Citi analysts recommending its stock and predicting significant revenue growth, partly due to deals with Nvidia, Meta, and an OpenAI expansion. RingCentral is accelerating its AI product launches, expecting to surpass its $100 million annual recurring revenue target for new AI tools before 2026, having invested $125 million into its AI portfolio. The company recently released RingWEM, an AI-powered workforce engagement management suite. Even automaker Rivian is entering the AI space, launching Mind Robotics, a new AI company, with $110 million in seed capital to advance industrial AI. Despite these advancements and corporate deals, Wall Street experienced mixed results, with disappointing economic data, such as an unexpected drop in manufacturing activity, dampening overall optimism and causing the Nasdaq Composite to fall as the AI-driven tech rally lost some momentum.

Key Takeaways

• OpenAI signed a $38 billion, seven-year cloud deal with Amazon Web Services (AWS) for AI computing power, utilizing hundreds of thousands of Nvidia's specialized AI chips.
• This deal is a major win for Amazon, boosting AWS's backlog by an estimated 20% from $200 billion and causing Amazon's stock to rise 5%.
• Amazon, previously seen as an AI laggard, has significantly increased AI investments, launched its Titan large language model, and supports OpenAI rival Anthropic as its primary cloud provider.
• Major tech companies, including Microsoft, Alphabet, Amazon, and Meta, collectively spent $112.5 billion on capital expenditures last quarter, a 77% year-over-year increase, with Microsoft leading at $34.9 billion.
• Palantir Technologies reported its best-ever Q1 results with $635.3 million in revenue (21% YOY growth) driven by AI platform demand, but its stock fell due to high valuation concerns.
• Shopify is heavily integrating AI, with its Sidekick digital assistant used by over 750,000 merchants in Q3, and expects AI to drive holiday shopping success.
• CoreWeave, an AI cloud computing company, is experiencing surging demand and stock growth, with Citi analysts recommending it due to deals with Nvidia, Meta, and an OpenAI expansion.
• RingCentral is accelerating AI product launches, investing $125 million into its AI portfolio, and expects to exceed $100 million in annual recurring revenue for new AI tools before 2026.
• Automaker Rivian launched Mind Robotics, a new AI company, securing $110 million in seed capital to advance industrial AI.
• Despite significant AI advancements and corporate deals, broader economic data, such as a drop in manufacturing activity, has tempered Wall Street's AI optimism, leading to a mixed market performance.

OpenAI and AWS sign $38 billion cloud deal

OpenAI will pay Amazon Web Services $38 billion over seven years for computing power. This deal helps OpenAI train new AI models and run ChatGPT queries using Amazon's facilities. Amazon expects to provide all needed capacity by the end of 2026, causing its shares to rise 5%. This agreement strengthens AWS's position as a top cloud provider, competing with Microsoft and Google. Amazon also supports OpenAI rival Anthropic with a multibillion-dollar cloud campus.

Amazon's $38 billion OpenAI deal boosts AI standing

Amazon's $38 billion cloud deal with OpenAI signals its strong return to the AI race. This agreement is a major win for Amazon Web Services, which had seen its cloud market share drop to 29%. Many investors previously saw Amazon as an AI laggard for not having a flagship large language model or a consumer chatbot like ChatGPT. However, Amazon has increased its AI spending and launched its own large language model, Titan. Analysts like Mamta Valechha and Brian Pitz believe this deal will help Amazon regain ground and boost AWS's backlog by about 20% from $200 billion. Amazon's stock rose 5% to a record high after the announcement.

Amazon secures $38 billion OpenAI cloud deal

Amazon's $38 billion cloud deal with OpenAI shows it is no longer lagging in the AI race. Amazon Web Services had seen its cloud market share drop to 29% as rivals like Microsoft and Google gained ground. The company was considered slow in launching its own large language model and consumer chatbot. However, Amazon has increased its AI investments, including opening an $11 billion AI data center in Indiana. This deal, along with strong quarterly results, suggests AWS is regaining momentum, with analysts like Mamta Valechha calling it a key first step. Amazon's stock rose 5% to a record high, and analysts expect the deal to boost AWS's backlog by about 20% from $200 billion.

OpenAI signs $38 billion computing deal with Amazon

OpenAI and Amazon have signed a $38 billion deal for AI computing power. This agreement allows OpenAI to run its artificial intelligence systems on Amazon's U.S. data centers, using hundreds of thousands of Nvidia's specialized AI chips through Amazon Web Services. Amazon shares increased 4% after the announcement on Monday. OpenAI will start using AWS compute immediately, with full capacity deployed by the end of 2026 and potential expansion beyond. OpenAI CEO Sam Altman stated that revenue is growing steeply, justifying the need for massive AI infrastructure investments. Amazon also serves as the primary cloud provider for Anthropic, a rival to OpenAI.

Palantir reports record quarter on strong AI demand

Palantir Technologies Inc. announced its best-ever quarterly results, driven by high demand for its artificial intelligence platform. The company reported a first-quarter profit of $102.1 million, or 4 cents per share, a significant improvement from a loss last year. Revenue increased 21% year-over-year to $635.3 million, marking its fifth straight quarter of over 20% growth. Commercial revenue, boosted by AI platform sales, surged 42% to $267 million, while government revenue grew 16% to $368 million. CEO Alex Karp highlighted unprecedented demand for AI capabilities. Palantir also raised its full-year revenue forecast to between $2.605 billion and $2.617 billion, and its 2025 revenue guidance to $4.4 billion.

Palantir stock drops despite strong earnings

Palantir Technologies Inc. shares experienced a significant sell-off on Thursday, falling 10% in premarket trading, despite reporting a strong first quarter. This decline appears to be due to investors taking profits and concerns about the company's high valuation. Palantir's first-quarter 2024 revenue reached $635 million, a 21% increase year-over-year, and earnings per share were $0.08, beating estimates. Both its government and commercial segments showed strong growth, and the number of commercial customers increased by 70%. However, the stock's rapid rise this year, more than doubling in value, has led to questions about whether its current price is sustainable.

Shopify bets on AI for holiday shopping success

Shopify President Harley Finkelstein is betting big on artificial intelligence to drive holiday season sales and e-commerce growth. The company's AI digital assistant, Sidekick, saw over 750,000 merchants use it for the first time in Q3, leading to nearly 100 million total interactions. A Shopify survey also found that about 64% of consumers plan to use AI for shopping during the upcoming holiday period. For the third quarter, Shopify reported revenue of $2.8 billion, exceeding estimates, and Gross Merchandise Value rose 32% to $92 billion. The company expects continued revenue growth for the fourth quarter, with its stock gaining over 56% in 2025.

Shopify sees AI as e-commerce game changer

Shopify views artificial intelligence as a game-changer for e-commerce, calling it the biggest technology shift since the internet. The company, which partnered with OpenAI in September, reported that traffic to its AI-powered tools tripled since January, and AI-powered purchases grew 11-fold. Shopify President Harley Finkelstein emphasized the company's advantage in the AI era, using data from millions of sellers and billions of transactions. Tools like the internal Scout use AI to help employees make better product decisions. For Q3 2025, Shopify's revenue rose 32% to $2.84 billion, exceeding analyst expectations, with net income at $264 million.

Economic data cools Wall Street AI optimism

Wall Street saw mixed results on Monday as disappointing economic data dampened optimism from corporate deals and AI advancements. The S&P 500 rose slightly, while the Nasdaq Composite fell. Reports showed that manufacturing activity unexpectedly dropped in May and construction spending fell in April, suggesting the Federal Reserve might delay interest rate cuts. Despite these concerns, major deals provided some support, including Bristol Myers Squibb's $14 billion acquisition of Karuna Therapeutics and Broadcom's $61 billion deal to buy VMware. Investors remain cautious, looking ahead to the Federal Reserve's interest rate decision and the monthly jobs report later in the week.

Citi recommends buying CoreWeave AI cloud stock

Citi analysts are optimistic about CoreWeave, an AI cloud computing company, and recommend buying its stock before its next earnings report. Citi maintained its buy rating and raised the price target to $192 per share, predicting a 52% upside. Analyst Tyler Radke highlighted rising demand for artificial intelligence as a key driver, noting CoreWeave's recent deals with Nvidia, Meta, and an OpenAI expansion. He expects significant revenue growth and large earnings beats, with demand likely to accelerate next year. CoreWeave went public in March and its stock has surged nearly 216% since its IPO.

Palantir's high valuation worries analysts

Analysts remain concerned about Palantir's "extreme" valuation, even after the company reported strong fiscal fourth-quarter earnings. Palantir exceeded estimates with adjusted earnings of 21 cents per share on $1.18 billion in revenue. Its U.S. government business revenue grew 52% year-over-year to $486 million, including a $10 billion contract with the U.S. army. However, shares dropped 7% on Tuesday morning because the stock trades at over 200 times forward earnings, much higher than the S&P 500. Major firms like UBS, Jefferies, Goldman Sachs, Citi, Deutsche Bank, Baird, and Morgan Stanley expressed concerns about the valuation, despite praising the company's strong fundamentals and AI leadership.

Nasdaq falls as AI rally loses steam

Wall Street opened lower on Tuesday, with the Nasdaq Composite leading the decline, as an AI-driven tech rally lost momentum. The S&P 500 fell 1.1%, the Dow dropped 0.7%, and the Nasdaq Composite decreased by 1.6%. Negative sentiment took over, partly due to Palantir's shares falling after market disappointment about its guidance. While AI investment deals like Amazon's with OpenAI had boosted big tech stocks, broader economic uncertainty, including delayed government data from a shutdown, made investors cautious about the U.S. economy.

Big tech's AI spending reaches record levels

Major tech companies are investing in artificial intelligence at a "mind-bending" pace, with combined capital expenditures from Microsoft, Alphabet, Amazon, and Meta jumping 77% year-over-year to $112.5 billion last quarter. Amazon's CFO stated that the company will continue significant AI investments, seeing it as a massive opportunity. Microsoft led the spending with $34.9 billion, followed closely by Amazon at $34.2 billion. Amazon expects its full-year capital expenditure to be around $125 billion, increasing in 2026. Despite mixed Wall Street reactions to recent earnings, these tech giants remain bullish on AI, even as some analysts question if current spending levels are sustainable given present AI revenues.

RingCentral boosts AI products to exceed $100 million goal

RingCentral is accelerating its AI product launches and expects to exceed its $100 million annual recurring revenue target for new AI tools before 2026. The cloud-based software company has invested $125 million into its new AI portfolio, seeing broad adoption across businesses of all sizes. CEO Vladimir Shmunis confirmed the company is on track to surpass its 2025 ARR goal. This week, RingCentral released RingWEM, an AI-powered workforce engagement management suite designed to improve its RingCX cloud contact center. RingWEM offers AI Quality Management, AI Workforce Management, and AI Interaction Analytics to enhance agent performance, customer satisfaction, and operational efficiency.

Rivian reports strong Q3 and launches new AI company

Rivian announced strong Q3 2025 results with rising revenues and vehicle deliveries, alongside the launch of a new AI company. The automaker built 10,270 vehicles at its Normal, Illinois, facility and delivered 13,201 vehicles in Q3, making it the peak quarter for the year. Consolidated revenues reached $1.56 billion, a 78% increase year-over-year, with software and services revenue surging 324% to $416 million. Rivian also completed construction for its R2 vehicle's new body shop and assembly building, with validation builds underway and customer deliveries expected in the first half of 2026. Additionally, Rivian founded Mind Robotics, a new AI company, securing $110 million in seed capital to advance industrial AI and leverage Rivian's operational data. The company plans to share more details about its autonomy vision and technology roadmap on December 11, 2025.

Sources

• Fortune: Deranged and self-destructive
• Amazon's $38 bln OpenAI deal shows it is no longer an AI laggard
• Amazon's $38 billion OpenAI deal shows it is no longer an AI laggard
• OpenAI and Amazon sign $38B deal for AI computing power
• Palantir Delivers 'Best-Ever' Quarter -- Hikes Guidance on Record AI Demand
• Palantir Faces Heavy Sell-Off After Blowout Quarter -- Here's What Investors Should Know
• Shopify President Bets Big On AI For Holiday Season Sales
• Shopify Sees AI as Game-Changer in E-Commerce with Strong Q3 Growth | Ukraine news
• Trading Day: Economic reality damps AI, deals optimism
• Buy this AI cloud stock ahead of earnings, says Citi
• Analysts remain concerned about Palantir's valuation even after earnings beat
• Nasdaq futures fall sharply as AI-driven tech rally loses steam (SPX:)
• Big tech’s AI investments grow at ‘mind-bending’ pace
• RingCentral Increases AI Product Launch to Beat $100MN Target Before 2026
• Rivian (RIVN) Q3 2025 report: Revenues and deliveries rise, R2 closer than ever, plus a new AI co.