Amazon completes $35B final tranche of OpenAI investment

Amazon Amazon.com, Inc. ↘ 2.24% has completed the remaining $35 billion of its $50 billion investment in OpenAI, finalizing one of the largest corporate investments in the history of the technology industry, The Information reported on Thursday. The completion comes roughly five months after the two companies announced their partnership and financing agreement in late February.theinformation

From Talks to Trillion-Dollar Ambitions

Amazon and OpenAI first disclosed the $50 billion commitment on February 27 as part of OpenAI's record $110 billion funding round, which also included $30 billion each from Nvidia ↘ 1.47% and SoftBank. Amazon's investment was structured in two stages: an initial $15 billion in OpenAI Series C Preferred Stock due by March 31, followed by an additional $35 billion contingent on undisclosed milestones or an OpenAI initial public offering.cnbc+2

According to an SEC filing from February, if a "Mandatory Funding Event" — the specific definition of which was redacted — occurred, Amazon would be required to purchase all remaining shares within five business days. Alternatively, an OpenAI IPO filing would trigger the same obligation. The equity commitment carried a deadline of December 31, 2028.geekwire

Amazon's Q2 2026 earnings, reported on Wednesday, showed the company had invested $28.7 billion cumulatively in OpenAI's Series C preferred shares through June 30, including $13.7 billion deployed during the second quarter. The completion of the final tranche appears to have followed shortly thereafter.news.futunn

A Broader AI Spending Spree

The investment is part of Amazon's broader push into artificial intelligence infrastructure. The company raised its 2026 capital expenditure target to $220 billion, with AWS revenue growing 37% year-over-year in the second quarter — its fastest growth in 18 quarters. Amazon CEO Andy Jassy noted that both the company's AI and custom chips businesses each surpassed $25 billion annualized revenue run rates.cnbc+1

Beyond OpenAI, Amazon has deepened its relationship with Anthropic, whose rising valuation generated $53.4 billion in pre-tax non-operating income for Amazon in Q2. AWS also announced new cloud agreements with Pinterest ↗ 0.33%, Snowflake ↘ 0.53%, and Meta ↗ 1.02%, among others.sec

Wall Street Wants Returns

The deal's completion arrives as investors are increasingly scrutinizing the returns on massive AI spending. Amazon's trailing twelve-month free cash flow turned negative at $7.6 billion as of June 30, driven by a $66 billion year-over-year increase in property and equipment purchases. Still, Amazon shares surged more than 10% in pre-market trading Friday following strong Q2 results, even as peers like Apple ↘ 0.80% fell on weaker services revenue and Microsoft ↗ 0.52% rallied on Azure growth earlier in the week.bbc+2