Amazon AWS Custom Chip Revenue Tops 25 Billion Dollar Annualized Rate
Amazon Web Services reported that its custom silicon business, covering Trainium, Graviton, and Nitro chips, has surpassed a $25 billion annualized revenue run rate in 2026. AWS raised its Q3 ASIC server shipment targets by 20 to 30 percent due to overwhelming demand from AI labs. The company also raised its 2026 capital expenditure guidance to $220 billion.
Amazon Web Services disclosed in mid-2026 that its custom chip business, which includes the Trainium, Graviton, and Nitro product lines, has exceeded a $25 billion annualized revenue run rate. The segment has seen triple-digit year-over-year growth, making it one of the fastest-growing divisions in Amazon's history.
Demand from major AI labs is driving the surge. Trainium 2 is reportedly sold out, and Trainium 3 is nearly fully booked. AWS responded by raising its Q3 2026 ASIC server shipment targets by 20 to 30 percent.
Trainium 3 uses a 3-nanometer manufacturing process and delivers computing power of 2.52 petaflops, double that of Trainium 2. It also offers four times higher energy efficiency and 1.7 times better memory bandwidth. Clusters of up to 144 chips can handle trillion-parameter AI models.
Anthropic has committed to using up to five gigawatts of Trainium capacity across current and future chip generations. OpenAI has committed to consuming two gigawatts of Trainium starting in 2027. Amazon Bedrock, which serves hundreds of thousands of customers, runs most of its inference workloads on Trainium.
Amazon raised its 2026 capital expenditure guidance to $220 billion, partly because of rising high-bandwidth memory costs required for AI accelerators. AWS operating margin expanded to 39.4% in Q2 2026. The company is already developing Trainium 5 to stay ahead of demand.
