Amazon Boosts AI Investment in Anthropic by $4 Billion

On November 22, Amazon (AMZN) announced a $4 billion investment in Anthropic, an artificial intelligence (AI) startup and developer of the AI chatbot Claude, which competes with OpenAI. This investment brings Amazon's total funding in Anthropic to $8 billion, though Amazon will retain a minority stake in the company. Despite the significant investment, Amazon does not hold a seat on Anthropic's board of directors.

Earlier this year, Amazon made a $2.75 billion investment in Anthropic, marking the company’s largest external investment to date. The two firms initially revealed a $1.25 billion investment partnership in September of the previous year.

In addition to the financial investment, Amazon Web Services (AWS) will become Anthropic's primary cloud and training partner. Going forward, Anthropic will leverage AWS's Trainium and Inferentia chips to train and deploy its AI models.

This strategic partnership will also offer AWS customers exclusive access to an advanced feature: the ability to fine-tune their data on Claude. This is a unique advantage for AWS customers.

A key reason for the additional investment may lie in Anthropic's recent announcement that its AI agent can now perform complex tasks on a computer with human-like capabilities. Jared Kaplan, Anthropic's Chief Science Officer, mentioned that Amazon has been using this AI tool, with early adopters including Asana, Canva, and Notion. Development of the tool has been ongoing since the beginning of this year.

In addition to Amazon's support, Google (GOOGL) also committed $2 billion to Anthropic last year. Google now holds a 10% stake in the company and has entered into a significant cloud computing agreement with Anthropic.

Anthropic, along with OpenAI, is part of a growing field of AI startups competing with major tech giants like Google, Amazon, Microsoft (MSFT), and Meta (META). With projections suggesting the generative AI market could exceed $1 trillion within the next decade, these companies are heavily investing in AI technology to maintain their positions at the forefront of this rapidly expanding industry.