Amazon keeps its custom chips in-house while Google sells its chips to outside customers, and both strategies now collide with the same limit: power. One approach protects margins, and the other leans on borrowed money. Which one holds up?
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Amazon (NASDAQ:AMZN | AMZN Price Prediction) and Alphabet (NASDAQ:GOOGL) reported third-quarter results a day apart in late October, and both quarters ran on homegrown chips. AWS used Trainium and Graviton to post its fastest growth in nearly five years. Google Cloud more than doubled, and TPU systems became a product Google sells directly. Both companies now need much more power to keep growing.
AWS Keeps Its Chips In-House. Google Sells Its Chips to Customers.
AWS revenue reached $45.98 billion, up 39%, with a 38.7% operating margin. Management linked part of that margin to custom silicon savings….
