I do wonder how much of Amazon's $50B share (per last press release) is in AWS credits rather than money in the bank.

To then claim that Trainium is “selling” and not a dud? I’d bet a lot.

Probably a lot? It would be much more tax-advantageous to do it this way, $50B worth of credits != $50B worth of spend on Amazon's part, and they might meet in the middle about how much equity that translates to.

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HWR_14 5 hours ago | parent [-]

I can see a lot of advantages for Amazon, but I don't see why it would be tax-advantageous.

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qurren 5 hours ago | parent [-]

Situation A:

You're Amazon. You give OpenAI $50B cash investment, they then hand you back the $50B over time because they buy $50B worth of Amazon AWS services (they would use AWS or other equivalent compute anyway). OpenAI pays an additional $1-5B in sales taxes on top of their $50B compute purchase. Now let's say you have $25B opex for said compute. You then have $25B profits, you pay 21% corporate taxes on the profits, so you too owe the government about $5B. Government collects around $6-10B on this whole transaction.

Situation B:

You're Amazon. You let OpenAI use your services by handing them API credentials that unlock what would normally cost $50B worth of services, but no money changes hands. You have zero revenue from the transaction, write off the $25B opex as a tax loss on your other profits elsewhere in the company. You thus pay ~$5B less tax on your other income as a company, and OpenAI also doesn't have to pay sales tax because they didn't actually purchase anything.

	▲	HWR_14 3 hours ago \| parent [-]
		You have to report barter transactions as income. And Amazon already pays 0% corporate income tax.