So Amazon’s CEO Andy Jassy just dropped some numbers that should have Nvidia shareholders doing a little happy dance. And honestly? The math is pretty wild.
Here’s the deal: AWS (Amazon’s cloud business that basically prints money) is pulling in $123 billion annually. That’s not just big – that’s “twice the size of Microsoft Azure” big. And here’s where it gets interesting for anyone holding NVDA stock.
The AI Gold Rush is Real
Jassy mentioned something that should make your ears perk up: 85-90% of the world’s IT spending is still happening in dusty server rooms instead of the cloud. But over the next 10-15 years? That’s flipping completely upside down. And AI is the rocket fuel making it happen faster.
Translation: We’re looking at a massive migration to cloud computing, and guess who makes the chips that power all that AI magic? Yep, our friends at Nvidia.
Why Nvidia Owns This Game
Sure, Amazon is trying to build their own chips (Trainium, Inferentia – cute names, right?). They’re even claiming 40-50% better price performance than Nvidia’s GPUs. But here’s the thing: Nvidia still owns over 90% of the AI chip market.
Why? Two words: CUDA ecosystem. It’s like trying to get iPhone users to switch to Android – technically possible, but good luck with that developer lock-in.
AWS executives basically admitted Nvidia chips will be their go-to for the next 5-10 years. Even while they’re building competitors. That’s like your biggest rival saying “yeah, you’re probably going to keep winning.”
It’s Not Just Amazon
Microsoft is reportedly running 1.3 million Nvidia GPUs across their data centers. Meta is planning to scale up to 350,000 H100 GPUs by 2026. Morgan Stanley thinks Meta alone could generate $250 billion in revenue for Nvidia. (Let that sink in for a second.)
Even Google Cloud, Oracle, and random sovereign AI projects are all betting on Nvidia’s chips. It’s like everyone decided to use the same textbook.
The Bottom Line
Yeah, Nvidia’s market cap is over $4 trillion. Yeah, that sounds insane. But when the global cloud computing market is projected to grow from $626 billion to $1.4 trillion by 2030, and Nvidia is basically the toll booth everyone has to pay to get there?
The stock might actually be undervalued. (I know, I know – saying a $4 trillion company is undervalued feels weird. But the math checks out.)
Jassy didn’t just deliver earnings numbers – he painted a picture of a world where cloud computing dominates everything, AI accelerates the transition, and Nvidia sits right in the middle collecting rent from everyone.
Not a bad place to be, honestly.