Amazon CEO Explains Layoffs, Buying ‘A Lot Of Nvidia,’ AI Chip Innovation And Doubling AWS Capacity

Amazon CEO Andy Jassy explains the reason for Amazon’s 14,000 layoffs, buying vast amounts of Nvidia hardware, the tech giant’s new Trainium3 chips and why AWS’ Bedrock will become as big as Amazon EC2.

Amazon CEO Andy Jassy took a deep dive last week explaining the reason for Amazon’s 14,000 layoff round, the company’s strategy for buying vast amounts of Nvidia hardware, its new Trainium3 chips and why AWS’ Bedrock AI platform will become as big as Amazon EC2.

“The [layoff] announcement that we made a few days ago was not really financially driven and it’s not even really AI-driven, not right now at least. It really—its culture,” said Amazon’s CEO during the company’s third-quarter financial earnings report on Oct. 30.

Additionally, Jassy provided key information on its Nvidia purchasing and strategy, as well as how spending billions on building new data centers and infrastructure each year has resulted in an explosion in AWS capacity.

“We’re now double the power capacity that AWS was in 2022,” Jassy said. “And we’re on track to double again by 2027.”

During Amazon’s third quarter earnings call, Jassy talked about the reason for Amazon’s layoff round, buying “a lot of Nvidia” products, how its Trainium2 chips are “now a multibillion-dollar business,” as well as how the company is “building Bedrock to be the biggest inference engine in the world.”

Amazon And AWS Q3 2025 Earnings Results

Before jumping into Andy Jassy’s boldest remarks, let’s take a quick look at Amazon and AWS’ financial earnings results for the third quarter of 2025.

Amazon generated a total of $180 billion in sales during the latest quarter, representing a revenue increase of 12 percent year over year.

The Seattle-based tech giant reported $17.4 billion in operating income, with AWS representing $11.4 billion of its parent company’s operating income.

AWS generated $33 billion in revenue for the third-quarter of 2025, up 20 percent year over year, for an annual run rate of a record $132 billion.

Here are the biggest remarks from Andy Jassy during Amazon’s earnings report .

Amazon Layoffs: If You Grow Fast, ‘You End Up With A Lot More People’ And ‘A lot More Layers’

The [14,000 layoff] announcement that we made a few days ago was not really financially driven and it’s not even really AI-driven, not right now, at least. It really—its culture.

If you grow as fast as we did for several years—the size of businesses, the number of people, the number of locations, the types of businesses you’re in—you end up with a lot more people than what you had before, and you end up with a lot more layers.

And when that happens, sometimes without realizing that you can weaken the ownership of the people that you have who are doing the actual work and who own most of the two-way door decisions. The ones that should be made quickly and right at the front line, and it can lead to slowing you down.

As a leadership team, we are committed to operating like the world’s largest start-up.

And that means removing layers.

It means increasing the amount of ownership that people have, and it means inventing and moving quickly.

It’s important to be lean. It’s important to be flat. It’s important to move fast. And that’s what we’re going to do.

‘We Are Not Constrained In Any Way In Buying Nvidia’

We have a very deep relationship with Nvidia. We have for a very long time. And we will for as long as I can foresee the future.

We buy a lot of Nvidia.

We are not constrained in any way in buying Nvidia.

I expect that we’ll continue to buy more Nvidia both next year and in the future.

But we’re different from most technology companies in that we have our own very strong chip team, and this is our Annapurna [Labs] team.

You saw it first on the CPU side with what we built with Graviton which is about 40 percent better price performance than the other x86 processors. And you’re seeing it again on the custom silicon on the AI side with Trainium, which is about the same amount of price performance benefit for customers relative to other GPU options.

‘We’re Building Bedrock To Be The Biggest Inference Engine In The World’

We’re building Bedrock to be the biggest inference engine in the world and in the long run, believe Bedrock could be as big a business for AWS as EC2.

And the majority of token usage in Amazon Bedrock is already running on Trainium chips.

Bedrock gives customers leading selection of foundation models and superior price performance to deploy inference into their next-generation applications. A lot of the future value companies will get from AI will be in the form of agents.

We’re also continuing to work closely with chip partners like NVIDIA, with whom we continue to order very significant amounts as well as with AMD and Intel. These are very important partners with whom we expect to keep growing our relationships over time.

You’re going to see us continue to be very aggressive in investing in capacity because we see the demand. As fast as we’re adding capacity right now, we’re monetizing it.

Jassy: ‘We’re Now Double The Power Capacity That AWS Was in 2022’

We’ve been focused on accelerating capacity the last several months, adding more than 3.8 gigawatts of power in the past 12 months, more than any other cloud provider.

To put that into perspective, we’re now double the power capacity that AWS was in 2022, and we’re on track to double again by 2027.

In the last quarter of this year alone, we expect to add at least another one gigawatt of power.

This capacity consists of power, data center and chips, primarily our custom silicon, Trainium and Nvidia.

We’ve recently brought Project Rainier online—our massive AI compute cluster spanning multiple U.S. data centers and containing nearly 500,000 of our Trainium2 chips.

Trainium2 Is ‘A Multibillion-Dollar Business’; Trainium3 Set To Launch By End of 2025

Trainium2 is really doing well. It’s a multibillion-dollar business at this point.

It grew 150 percent quarter-over-quarter in revenue.

And you see really big projects at scale now, like our Project Rainier that we’re doing with Anthropic, where they’re training the next version of Claude on top of 500,000 Trainium2 chips, [then] going to 1 million Trainium2 chips by the end of the year.

Today, with Trainium2, we have a small number of very large customers on it. … but we expect to accommodate more customers starting with Trainium3.

But because Trainium2 is 30 percent to 40 percent more price performance than other options out there, and because as customers start to contemplate broader scale of their production workloads, moving to being AI-focused and using inference—they badly care about price performance.

Trainium3 should preview at the end of this year with much fuller volumes coming in the beginning of 2026.

We have a lot of customers, both very large and medium-sized, who’re quite interested in Trainium3.

‘AWS Is Growing At A Pace We Haven’t Seen Since 2022’

AWS is growing at a pace we haven’t seen since 2022, reaccelerating to 20.2 percent year-over-year, our largest growth rate in 11 quarters.

It’s worth remembering that year-over-year percentage growth is a relative term.

It’s very different having 20 percent year-over-year growth on a $132 billion annualized run rate than to have a higher percentage growth rate on a meaningfully smaller annual revenue, which is the case with our competitors.

Backlog grew to $200 billion by Q3 quarter end and doesn’t include several unannounced new deals in October, which together, totaled more than our total deal volume for all of Q3.

AWS is gaining momentum. Customers want to be running their core and AI workloads in AWS given its stronger functionality, security and operational performance.

And the scale I see in front of us gives me significant confidence in what lies ahead.