Amazon’s Potential Arm IPO Investment: 5 Things To Know From AI To AWS
From boosting AWS cloud capabilities to making Amazon an AI powerhouse, here are five things to know about Amazon’s potential anchor investment in Arm’s upcoming IPO.
AWS Building New Data Centers At Blistering Pace
In order to stay the No. 1 cloud company in the world, Amazon continues to spend billions each year on building new data centers across the globe that power its cloud services. Each AWS data center campus, known as AWS Regions and AWS Local Zones, are typically full of thousands of servers and other IT infrastructure that need CPUs to run.
As Bernstein Research noted, over 50 percent of all Arm server CPUs across the globe are now deployed in AWS’ data centers. This means AWS needs a semiconductor provider that has a somewhat endless amount of CPUs to buy from on both a short- and long-term basis.
AWS is arguably expanding its cloud computing footprint faster and wider than any company in the world by building and equipping new data centers.
For example, AWS in June unveiled a $7.8 billion investment in Ohio to build new data centers. Other massive data center investments AWS announced in 2023 include: $35 billion for new cloud regions across Virginia; $12.7 billion to build new data centers in India; and a $6 billion data center investment in Malaysia.
The Takeaway: AWS needs a semiconductor provider that has a relatively endless supply of CPUs to power its multibillion-dollar data center footprint expansion plans across the globe. Arm could have a steady flow of sales to Amazon for years to come.