Of course, Jassy doesn’t throw the gauntlet down directly. He takes a more nuanced approach. For instance, in his challenge to Nvidia, he writes, “We have a strong partnership with NVIDIA, will always have customers who choose to run NVIDIA” and will always support these chips in its cloud.

But he also says: “Virtually all AI thus far has been done on NVIDIA chips, but a new shift has started.” AWS customers, he says, “want better price-performance” meaning Amazon’s own home-grown Trainium AI chips.

Jassy says demand is so high for this chip that capacity for the newest one, Trainium3, is nearly sold out. Remarkably, he says that capacity is also nearly sold out for Trainium4, which is still 18 months away from being available.

This means that Amazon’s chip business has hit a $20 billion annual revenue run rate. But if Amazon were a chipmaker that sold its wares to others, it would be at $50 billion ARR, he postulates.