Updated
Updated · CNBC · Aug 27
Nvidia Extends AI Chip Surge With 2 Million-GPU Amazon Deal as ROI Falls Below 1 Year
Updated
Updated · CNBC · Aug 27

Nvidia Extends AI Chip Surge With 2 Million-GPU Amazon Deal as ROI Falls Below 1 Year

3 articles · Updated · CNBC · Aug 27

Summary

  • Nvidia shares jumped nearly 8% after the company posted better-than-expected fiscal 2027 second-quarter results and signaled strong sales growth into next year.
  • Less-than-1-year returns on AI infrastructure are driving that demand, CEO Jensen Huang said, arguing customers can profit quickly even from $50 billion data centers.
  • Amazon Web Services added fresh proof by agreeing to buy 2 million more Nvidia GPUs in 2027 and 2028, while also adopting Vera CPUs and Nvidia robotics technology.
  • That commitment stands out because Amazon is building its own AI chips, suggesting Nvidia hardware still offers compelling economics alongside in-house alternatives.
  • Nvidia said current-quarter growth will be led mainly by non-hyperscalers, with neoclouds and enterprises joining big cloud providers in broadening the AI spending base.

Insights

Amazon makes its own AI chips, so why is AWS suddenly spending billions to stockpile millions of Nvidia GPUs instead?
With Nvidia funding the very neoclouds buying its chips, is the AI boom a genuine gold rush or a circular financial illusion?