Amazon.com Inc.'s (NASDAQ:AMZN) cloud unit is betting that cheaper AI, stronger safety controls and rising customer demand will turn today's massive infrastructure investments into a broader, more accessible market for artificial intelligence.
Amazon Web Services Chief AI and Technology Officer Matt Wood said the company wants to lower the cost and technical barriers around AI much like cloud computing simplified website development.
Wood Pushes Back On AI Safety Concerns
Wood rejected the idea that more capable AI agents must become less safe.
He told CNBC on Thursday that developers can surround AI models with controls, guardrails, security and privacy protections while continuing to improve the underlying technology.
Wood also pushed back against the notion that companies must choose between development speed and safety. He said businesses can adjust investments in usability and safeguards as new AI capabilities emerge.
Falling Costs Could Broaden AI Adoption
Wood also defended AWS's $220 billion infrastructure investment, pointing to customer demand and internal business metrics supporting the spending.
He expects additional computing capacity and greater operating efficiency to reduce costs and make AI available to more businesses and users.
Outside the most advanced frontier models, Wood said the cost of delivering a given level of AI intelligence is falling by one or two orders of magnitude every three to six months.
He attributed that decline to improving efficiency as companies learn how to operationalize frontier models and run them at lower cost.
Wood expects hyperscalers to monetize their infrastructure investments as those savings make AI agents and other capabilities more widely accessible.
AWS Growth Helped Push Amazon Past $3 Trillion
Accelerating AWS growth also helped propel Amazon above $3 trillion in market value for the first time in August 2026.
Investor concerns over Amazon's heavy AI spending eased after second-quarter results showed AWS revenue growing at its fastest pace since 2021, Bloomberg reported.
Amazon stock surged more than 15% in one session, adding nearly $400 billion in market value, before gaining as much as another 5.3% when the company crossed the $3 trillion threshold.
TD Cowen Sees AWS Demand Outrunning Capacity
That momentum echoes an earlier bullish assessment from TD Cowen analyst John Blackledge, who said accelerating AI demand was already translating into stronger AWS growth and profitability.
Blackledge highlighted to Bloomberg in July that AWS's fifth consecutive quarter of accelerating revenue growth, while its AI business exited the quarter at roughly a $25 billion annual run rate.
He also pointed to strong non-AI growth and margin expansion that exceeded consensus expectations.
Blackledge Sees Trillion-Dollar AWS Revenue Potential
Blackledge noted CEO Andy Jassy's view that AWS could eventually generate $1 trillion in revenue, compared with the $600 billion long-term opportunity Jassy discussed in his April shareholder letter.
Amazon expects AWS to remain capacity constrained through 2026 and 2027 because of AI demand, even as it plans to double AWS capacity by the end of 2027.
Blackledge also pointed to Jassy's comments about demand AWS already sees for 2028, which prompted TD Cowen to materially increase its five-year AWS revenue and operating-income forecasts.
He said Jassy clearly connected Amazon's AI spending with future capacity, demand and revenue opportunities, offering investors a more defined commercialization narrative around the company's infrastructure buildout.
AMZN Stock Price Activity: Amazon.com shares are trading higher by 0.08% at $249.34 at the time of publication on Thursday, according to Benzinga Pro data.