How much Anthropic and Cursor spend on Amazon Web Services

> through September, Anthropic has spent more than 100% of its estimated revenue (based on reporting in the last year) on Amazon Web Services, spending $2.66 billion on compute on an estimated $2.55 billion in revenue.

Well I don't have to scratch my head any longer and wonder why Amazon hasn't jumped on the AI bandwagon with their own Gemini or whatever. They are sitting pretty and selling shovels and pickaxes to the AI fools. Not a bad strategy for them...

Amazon owns 15-19% of Anthropic. So yes and no.

They have their own models, the Nova series, although my experience has been pretty mixed with them.

GenAI financing is a flat circle. The bubble bursting is going to have a huge blast radius.

They survived the dot-com bubble, I don't see the AI bubble taking out Amazon.

It might take out your 401k for a decade.

I'm on like my fifth once in a generation financial crisis.

At a certain point you just expect it.

No way their share is so high. Where did you get these numbers from?

Amazon trained their own models like Nova and has AI coding assistants like Amazon Q, but I don't know anyone outside Amazon who is using them.

it's a number 2 years out of date. they invested 8b and ant is now worth 183b.

They actually do have Alexa.

this is the latest mantra from people who have missed the boat. i'm like lol do you think that industry didn't learn anything (about financing structures) from the last one?

How are you getting 5? In recent memory, there's only 3: dotcom bubble (2000), GFC (2008), covid (2020). You'd either have to go back in time even more (eg. savings and loan crisis in the 80s/90s), or include regional ones (eg. eurozone crisis) to hit 5.

Yes, the Amazon AI stuff isn’t great. They don’t really have the right leadership or talent to do anything particularly competitive there.

All they will learn is how to shift more of the risk on to retail investors and B tier institutional investors.

I don't think anyone is expecting Amazon (or Google or Microsoft for that matter) to be taken out by the AI bubble.

I would expect to see OpenAI, Anthropic, and a lot of the little tool wrappers to get taken out though, or at least acquired for pennies on the dollar when it bursts.

But like the last one, it's going to be us, the tax payers, that are left holding the bag.

. . . once in a [news media financial analyst] generation financial crisis.

Its like fruit fly generations, not 20-30 year human cohort generations.

If you were 100 then you'd be right on pace. Or slightly ahead. Apparently a generation is 25-30 years. I think they should update that

I guess by this logic we should never have a depression/recession/bubble burst ever again? We always learn from our mistakes!

Why taxpayers? Where’s the systemic risk in AI labs getting acquired for cents on the dollar? The taxpayers weren’t holding the bag during the dot com crash, just investors.

Why do they need to compete? AI at Amazon should be laser-focussed on two things: selling compute time to AI Wannabees, and up-selling stuff to me in the shop.

Everything else is expense.

That doesn't tell us what percentage they own, though. When you invest in a company and the value goes up, your percentage doesn't change (unless there are additional investors)

I agree. Unfortunately AWS leadership is in an all out panic to compete, diverting attention away from core services. I wish they’d just get back to focusing on the foundational stuff!

During the dot com crash, none of the companies were "too big to fail" This is looking more like 2008 than dotcom, the entire market is being propped up by basically Nvidia. US GOV is likely to bail them out for "national security"

Maybe they had strong exposure to Worldcom or Enron?

AWS is not winning selling compute to AI folks. GCP and Azure have both done better selling AI services, which is part of the problem. Amazon is still the king for basic compute, but fell behind on the AI infra.

that's really naive im afraid. you have to take pro rata or the percentage goes down. amzn did not take pro rata.

Are you counting eurozone as 2011? I think it counts enough as American if it caused a downgrade in the USG's credit rating.

[1]: https://en.wikipedia.org/wiki/August_2011_stock_markets_fall

They do and they've had her for a while, but from what I understand that's "so last Tuesday" in the AI race. It was ok in the race with "Ok Google" and "Siri" but not competing with OpenAI, Anthropic, Gemini.

I am not sure what you mean by naive. I also didn't say the percentage wouldn't go down, I literally said other investment rounds would change the percentage they own.

Amazons investment in Anthropic was in the form of convertible notes, which they have converted entirely into equity by march of this year. At that time, Anthropic was valued at 61.5 billion and Amazon (in their filings) said their investment was worth 13.8 billion, so about 22% of the company.

Then, there was another round in September where Anthropic raised 13 billion more at a valuation of 183 billion (so the new investors are buying about a 7% stake in the company). Without more details, that would lower amazons percentage to about 20% (old investors hold 93% of the company, so Amazon's 22% of the remaining 93% comes out to about 20%). There are probably other details that lower that percentage a bit, but i think the 15-19% ownership estimate is pretty accurate.