Andy Jassy, CEO of Amazon, confirmed on the 11th (local time) that "generative artificial intelligence (AI) could be the biggest technological innovation since the internet" and that the company is making focused investments in this area.
In his annual letter to shareholders on the same day, CEO Jassy stated, "The AI era revolution will be built on the cloud from the start," and "The social and business benefits that can be gained through AI solutions will astonish us all."
He added, "We expect AI to drive tens of billions of dollars in revenue for the company over the coming years," expressing confidence that "a significant portion of the world-changing AI will be built on AWS (Amazon Web Services), Amazon's cloud division."
CEO Jassy explained that Amazon is currently focusing on three areas related to AI: AI models, applications built on models like ChatGPT, and the development of chips that power these applications. He also confirmed the addition of Andrew Ng, an AI expert from Stanford University known as one of the so-called 'AI Four Heavenly Kings,' as a board member.
Additionally, Amazon recently invested $4 billion in Anthropic, an AI startup considered a competitor to OpenAI, and unveiled its self-developed upgraded AI chip, 'Trainium2.' The company has also launched AI chatbots such as 'Q,' which assists employees with their work, and 'Loophus,' an AI-based shopping chatbot.
However, CEO Jassy repeatedly emphasized that Amazon is still in the early stages of AI development and predicted that it will take time before significant profits are realized. The Wall Street Journal (WSJ) reported, "Amazon has lagged behind other tech companies in the AI race but has been striving to strengthen its position with new products in AWS and retail operations," adding, "CEO Jassy referred to AI as a long-term investment and noted that it will take time."
Alongside massive investments in AI technology, Amazon is also accelerating cost-cutting measures. After reducing 27,000 jobs from late 2022 to early last year, the company recently laid off hundreds more in AWS. CEO Jassy explained, "We have reevaluated every part of our order fulfillment network and discovered several areas where we can reduce costs while delivering to customers faster," adding, "Over the past year, we reorganized our delivery system to place items sold in warehouses closer to customers, thereby cutting costs." Amazon operates hundreds of warehouses across the United States.
CEO Jassy expressed optimism about Amazon's streaming service, 'Prime Video,' and its satellite internet business prospects. Amazon recently added advertising to its streaming service. He also described last year's test satellite launch for the satellite internet business as a "major milestone" and expects to launch the first commercial satellite this year. He said, "There is still a long way to go, but we are encouraged by our progress." This is CEO Jassy's third annual letter since taking office.
Meanwhile, on the New York Stock Exchange that day, Amazon's stock closed up 1.67% compared to the previous session, marking an increase of about 24% since the beginning of the year.
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