Amazon Web Services is stepping up its AI infrastructure buildout, with Amazon raising this year’s capital spending from an earlier $200 billion estimate to $220 billion, a 10% increase. The report says the added budget is focused on AI data centers, servers and network equipment, lifting order growth for suppliers including Alchip, Wiwynn, Foxconn and Taiwan Semiconductor Manufacturing Co. (TSMC).
AWS lifts annual capital spending to $220 billion
According to the report, which cited the Economic Daily News, Amazon CEO Andy Jassy recently said the imbalance between supply and demand for AI computing power is expected to continue through 2027. He also said demand for 2028 has already begun to surface, at a scale that surprised him.
Against that backdrop, Amazon raised its annual capital spending by another 10%. The report said AWS’s AI business, combined with its in-house chip operations, has reached $25 billion in scale and continues to post triple-digit annual growth, pointing to sustained enterprise demand for cloud-based AI compute.
TSMC sees stronger 3 nm demand as AWS pushes custom ASIC shipments
The report described Annapurna Labs, Amazon’s chip design arm, as the center of AWS’s AI chip strategy. In recent years, the unit has expanded its in-house capabilities for AI training and inference chips, with its custom ASIC products mainly manufactured by TSMC on the 3 nm process.
As AWS moves ahead with AI server shipments, related 3 nm orders for TSMC are expected to keep rising. The report said that would reinforce TSMC’s standing in AI chip foundry manufacturing.
Alchip says quarterly revenue and profit may both reach record highs
As a key ASIC design partner for AWS’s in-house AI chips, Alchip said it is highly optimistic about operating performance this quarter. The company expects both quarterly revenue and profit to reach all-time highs, with fourth-quarter performance still set to grow.
It also said demand for its 3 nm AI accelerator project has come in above earlier estimates, creating room for higher shipment volume and revenue contribution next year. Based on confirmed projects and next-generation customer programs expected to tape out before the end of this year, order visibility is expected to extend at least three to four years.
Wiwynn handles AI rack assembly while Foxconn enters CPU tray supply
On the server assembly side, Wiwynn is responsible for full-system assembly of AWS ASIC AI racks and also supplies switch trays. Foxconn, meanwhile, entered the AWS supply chain this year and secured CPU tray orders, according to the report.
With AWS continuing to expand procurement, the report said capacity utilization at both assemblers is running at full speed. Wiwynn has benefited this year from a continued influx of orders from U.S. cloud service provider customers, along with GPU-related projects contributing in the second half. Market analysts cited in the report estimated Wiwynn’s revenue could grow 40% year over year in 2026 and reach a record high.
Foxconn targets more than 40% share of the ASIC server market
Foxconn rotating CEO Chiang Chi-heng recently said the group has made concrete progress in ASIC projects this year, including new customer wins and new project opportunities. He said Foxconn expects its share in the ASIC segment to rise sharply this year, lifting profit contribution as well.
The report said Foxconn has set a target of taking more than 40% market share in ASIC servers and remains confident about maintaining business growth over the coming years.
According to the report, AWS’s large-scale AI infrastructure procurement wave is now translating into revenue momentum for Alchip, Wiwynn and Foxconn, with demand visibility extending into 2028.