Amazon Moves to Sell Trainium AI Chips to External Data Centers, Challenging Nvidia

Amazon Web Services is negotiating the sale of its custom‑designed Trainium artificial‑intelligence accelerators to third‑party data‑centers. The move, confirmed by AWS AI chief Peter DeSantis, is intended to erode Nvidia’s dominance in the AI‑hardware market. Trainium 3, built on a 3 nm process, is reported to be “practically sold out,” while interest is already strong for a fourth generation expected next year.

Amazon says the Trainium line has already generated more than $225 billion in revenue commitments and projects up to $50 billion of annual sales if the chips are sold externally, a figure compared with the roughly $326 billion Nvidia generates from its GPU business. The company hopes to capture pricing‑sensitive demand for “sovereign” AI compute in Europe and other regions that favor locally‑controlled infrastructure. DeSantis emphasized that under‑utilisation of AI capacity means the external sales effort will not cannibalise AWS cloud revenue.

Analysts note that Amazon will need additional fab capacity—likely through partners such as TSMC—to meet external demand without hurting its own cloud customers. The strategy mirrors similar moves by Google and Microsoft, which are also exploring sales of their own AI accelerators.