In its annual year-end closing letter Speaking to shareholders, Amazon CEO Andy Jassy emphasized the importance of generative artificial intelligence not just for the company’s bottom line, but for the entire technological landscape.
Comparing its impact to that of the advent of the cloud, Jassy’s sentiments reflect a growing recognition of the power of GenAI among technology workers.
The news came as the company reported 12% year-over-year revenue growth to a staggering $575 billion.
AWS is grateful for generative AI
Amazon Web Services (AWS), Amazon’s cloud division that manages the generative AI side of the business, reported slightly higher revenue growth of 13% year over year. The division’s revenues of $91 billion accounted for 15.8% of the company’s accounts.
In the letter, Jassy states: “Generative AI could be the biggest technological transformation since the cloud (which is still in its early stages), and perhaps since the internet.”
Jassy also commented on the relative simplicity of GenAI, saying that while moving from on-premises to the cloud requires a significant migration effort, generative AI can be layered on top of existing work in the cloud.
He added: “The amount of social and business benefits from the solutions that will be possible will surprise us all.”
However, the journey to realizing the full potential of generative AI is not without challenges. Jassy recognized technology’s hunger for computing resources, software services and infrastructure.
Looking ahead, the CEO noted the importance of collaboration and diversity in the AI landscape, adding that “the vast majority (of GenAI applications) will ultimately be built by other companies.”
In terms of its cloud computing business, the company’s last full fiscal year started with widespread cost-cutting efforts, including layoffs, but toward the end things started to pick up thanks to investments in internal components.
More broadly, however, Amazon’s CEO stated that the company is “not done cutting our service costs yet,” indicating that further measures to improve efficiency, including layoffs, could be on the cards. Amazon’s layoffs over the past three months have affected only a few hundred, making them significantly smaller than previous efforts.