Amazon Shares Jump 25% on Meta Graviton5 Deal and $100B Anthropic Pact
Amazon shares have climbed over 25% in the past month after securing a deal to supply AWS Graviton5 chips to Meta and a $100 billion, 10-year Anthropic commitment. The custom chip business now runs at a $20 billion revenue pace, but a 37x P/E ratio and $200 billion capex plan raise valuation concerns.
1. Surging Stock Performance
Amazon shares soared over 25% in the last month, driven by investor optimism around its AI infrastructure initiatives and major partnership announcements.
2. AI Infrastructure Deals
The company secured a deal to supply AWS Graviton5 chips to Meta and obtained a $100 billion, decade-long commitment from Anthropic, boosting expectations for AWS growth and long-term AI leadership.
3. Rapid Chip Business Expansion
Amazon’s custom chip segment now generates a $20 billion annual revenue run rate with triple-digit growth, reflecting a strategic push into AI hardware and differentiation from competitors.
4. Valuation and Capex Considerations
Despite robust growth, a 37x P/E ratio and plans for $200 billion in capital expenditures for 2026 raise questions about near-term valuation resilience and free cash flow impact.