Amazon CEO Jassy defends AWS AI lead amid investor scrutiny on growth and competition

Amazon CEO Andy Jassy recently delivered a detailed 8-minute defense of AWS’s position in the generative AI market during an earnings call, addressing investor concerns about its competitive edge amid a volatile stock reaction. The conversation was initiated by Morgan Stanley analyst Brian Nowak, who signaled that he would not be offering conventional praise for the quarter but instead challenging Jassy on AWS’s ability to stay at the forefront of AI innovation [1].

Nowak raised two key questions: whether AWS is falling behind in generative AI and whether its revenue growth should accelerate in the second half of the year given the increasing demand for AI tools. Jassy responded by emphasizing that the AI transformation is still in its early stages. He noted that while top model providers are using AWS, many smaller customers are just beginning to build their AI capabilities and are not yet major users [1].

The CEO highlighted AWS’s strategic advantage in the evolving cost structure of AI development. As large model providers shift focus from training to inference, AWS’s custom Trainium chip is positioned to deliver better price performance than competing GPUs, offering a 30% to 40% improvement [1]. This, he argued, gives AWS a clear edge in the inference stage, which is crucial for customer-facing AI applications.

For companies using third-party models to build their own AI applications, Jassy pointed to Amazon Bedrock as a rapidly growing platform that offers access to a wide range of models. He also stressed that AWS’s broader cloud infrastructure provides a natural advantage for AI workloads, as companies tend to run applications close to their existing data and systems [1].

When asked about the possibility of AWS accelerating its growth in the coming months, Jassy remained cautiously optimistic. He did not provide specific forecasts but emphasized that more AI products are being rolled out and expected to scale in the next few quarters. He also defended AWS’s 18% annual revenue growth, noting that it operates in a $123 billion business with AI adoption still in its early innings [1].

Jassy’s remarks underscore AWS’s long-term confidence in the AI transformation and its belief that the company is well-positioned to benefit from the ongoing shift in enterprise technology strategy [1].

Source: [1] Andy Jassy unleashed an 8-minute defense of Amazon's AI ... (https://fortune.com/2025/07/31/amazon-aws-ai-andy-jassy-earnings-defense/)