Tech
May 28, 2026
Snowflake Signs $6B Deal with AWS for AI CPU Chips
Snowflake has signed a $6 billion, five-year agreement with Amazon Web Services (AWS) to use AWS's …
The Massive Deal
Cloud data storage giant Snowflake has signed a new $6 billion five-year agreement with Amazon Web Services, the companies announced on Wednesday. This deal is significant as Snowflake has sold $7 billion worth of its services via AWS Marketplace since its founding in 2012.
Driving Growth with AI
The growth is driven by AI, with Snowflake offering its AI building tool, Cortex AI, which provides features like a text interface for database queries and summary reports. The increasing demand for AI processing power has led to a surge in CPU usage, with CPUs handling most tasks associated with AI.
The Role of Graviton Chips
Snowflake is signing this contract for more access to AWS's home-grown ARM-based CPU chip, Graviton. Amazon CEO Andy Jassy boasted that Amazon's own homegrown AI chips offer "better price-performance" than Nvidia's offerings.
The Impact on the Market
The deal highlights the growing demand for AI processing power and the competition in the market.
Cloud providers like AWS are deploying chips as fast as they can to meet the demand.
Major AI model makers have architected their apps specifically for Nvidia's chips, but Amazon's chips are a more affordable option.
The Future Outlook
The multibillion-dollar cloud deals show how AI is lifting AWS's boat. Whichever companies benefit most from the rise of AI, the cloud providers are getting their share. Nvidia CEO Jensen Huang said he's ready to defend and grow his turf with the new AI-specific CPU, Vera.
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#AWS
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