Uber latest to embrace Amazon's AI chips

Amazon announced on Tuesday that Uber is expanding its AWS cloud contract to run more of its ride-sharing features on Amazon's own processors. Uber will extend its use of AWS Graviton, a low-power ARM-based server CPU, and begin testing Trainium3, AWS's AI chip that competes with Nvidia.

This agreement is less about posing a long-term threat to Nvidia and more about Amazon snubbing its cloud rivals Google and Oracle.

Uber, which historically managed its own data centers, signed major multi-year cloud deals with Oracle and Google in 2023. The company stated its intention to shift most of its IT infrastructure from its own facilities to these two cloud platforms.

In December, Uber reaffirmed that objective in a blog post:

"In February 2023, Uber started migrating from on-premises data centers to the cloud using OCI and Google Cloud Platform, tackling the twin challenges of moving large workloads and introducing Arm-based compute instances into what was previously an x86-dominated environment."

In that post, Uber specifically highlighted its use of Ampere's ARM chips in Oracle's cloud. This is where the story gets interesting.

For a quick lesson in how interconnected Silicon Valley is, consider the history of Ampere.

Ampere was founded by former Intel executive Renee James after she was passed over for the CEO role at the chipmaker. She leveraged her influence, including her position as an investor at private equity firm Carlyle and her seat on Oracle's board, to secure funding for the startup. Oracle owned roughly one-third of the company, and James had to resign as an independent Oracle director due to that investment.

(James, incidentally, was a key board member who helped approve Oracle's $9.3 billion acquisition of NetSuite in 2016, a company in which Larry Ellison held a large stake. That deal led to an unsuccessful shareholder lawsuit claiming Oracle overpaid.)

In December, Softbank, Ampere's major competitor, acquired the company, and Oracle sold its stake for a substantial pre-tax gain of $2.7 billion. James stepped down from Oracle's board at the end of 2024 and is no longer with Ampere.

Oracle is aggressively raising funds to build data centers for OpenAI and Stargate. Ellison stated that Oracle sold Ampere because in-house chip design for its data centers was no longer seen as a competitive edge. Instead, the company prefers to purchase chips and has inked large deals with Nvidia.

Notably, Oracle, Softbank, and Nvidia are all participants in OpenAI's network of circular deals intended to finance the AI company's massive data center expansion.

Now, AWS announces it has secured a larger contract from one of Oracle's premier customers, Uber, thanks to its in-house chip designs.

Uber joins Anthropic, OpenAI, and Apple among the major tech companies that have adopted or expanded their use of AWS due to these AI chips. In December, Amazon CEO Andy Jassy noted that Trainium had already become a multibillion-dollar business.

(For an inside look at the team and lab behind these chips, see our exclusive facility tour.)