Snowflake expands AWS partnership with $6 billion chip agreement

Cloud data storage company Snowflake has signed a new five-year, $6 billion agreement with Amazon Web Services (AWS), the companies announced on Wednesday. Snowflake is signing the contract to secure more access to Graviton, AWS’s home-grown ARM-based central processing unit (CPU) chip. While Snowflake has historically run on AWS, the company’s services are also available on competing cloud platforms, including Microsoft Azure and Google Cloud.

The scale of the agreement highlights the expanding financial relationship between the two companies. According to Snowflake, its customers doubled their spending on AWS in 2025 to $2 billion for that calendar year alone. To put the new contract into perspective:

• New commitment: Snowflake has committed to a $6 billion spend over the five-year duration of the contract.
• Historical sales: According to AWS, Snowflake has sold $7 billion worth of its services via the AWS Marketplace since Snowflake was founded in 2012.

The demand for CPU capacity is rising as artificial intelligence applications transition from training to daily automation. While graphics processing units (GPUs) are typically used for training AI models, CPUs handle many of the operational tasks associated with running AI agents. To support these workloads, Snowflake offers Cortex AI, its tool for building AI applications. The tool provides features like a text interface for database queries and summary reports.

Amazon CEO Andy Jassy stated last month that Amazon’s homegrown AI chips offer “better price-performance” than Nvidia’s offerings. Although AWS still uses Nvidia’s chips in its cloud, its own chips are a more affordable option to deploy. This cost advantage is helping AWS secure large contracts, such as a recent deal to supply millions of Graviton chips to Meta. That agreement followed a separate $10 billion deal Meta signed with Google Cloud.

The competition among cloud providers to develop their own silicon is intensifying. Google has been making its own AI chips for years, and Microsoft launched its Maia AI chip in January. However, Nvidia is actively defending its position. Last week, Nvidia CEO Jensen Huang stated that the company’s “brand new” AI-specific CPU, called Vera, represents a $200 billion market. Huang noted that Nvidia has already sold $20 billion worth of the Vera chips.

Why it matters

Snowflake is securing this contract to gain deeper access to AWS’s home-grown Graviton chips, a move to manage the rising CPU demand caused by the shift from AI training to daily AI automation.