Amazon (AMZN) will invest $50 billion to grow its AI offerings for the US government, the company said on Monday. The investment will include nearly 1.3 gigawatts of new data center capacity for Amazon’s AWS Top Secret, AWS Secret, and AWS GovCloud services.

Amazon stock rose more than 1% on the news.

Amazon says its latest announcement will give federal agencies access to the company’s Amazon SafeMaker AI for model training, Amazon Bedrock for AI agent deployment, Amazon, Nova, Anthropic’s (ANTH.PVT) Claude, Amazon’s Tranium AI chips and Nvidia’s AI infrastructure.

All of that will allow the government to use AI tools that Amazon says help it with simulation and data modeling, processing global security data faster, and improving supply chain information. The company said the arrangement will also help with defense strategies by processing satellite imagery, and sensor data to detect threats and create response plans.

"Our investment in purpose-built government AI and cloud infrastructure will fundamentally transform how federal agencies leverage supercomputing,” Amazon’s AWS CEO Matt Garman said in a statement.

“We're giving agencies expanded access to advanced AI capabilities that will enable them to accelerate critical missions from cybersecurity to drug discovery. This investment removes the technology barriers that have held government back and further positions America to lead in the AI era," he added.

Amazon has largely been seen as an also-ran in the AI race until relatively recently. Earlier this month, the company entered into a $38 billion agreement with OpenAI that will see Amazon provide OpenAI with access to its data centers and chips for seven years.

Amazon also launched its massive Project Rainier AI cluster in October, which will help power Anthropic’s AI services.

The announcement comes amid Big Tech’s ongoing AI spending spree that will see Amazon pump upwards of $125 billion into its data center projects in 2025. The company says it will spend even more during 2026.

Fellow tech giant Meta (META) is projecting to spend between $70 billion and $72 billion in 2025, while Microsoft (MSFT) says it expects to spend more in 2026 than the $88.2 billion the company spent during its fiscal 2025.

Google (GOOG, GOOGL), which anticipates it will spend $91 billion to $93 billion in 2025, says it will also spend more in the year ahead.

OpenAI (OPAI.PVT), meanwhile, has committed to spend more than $1 trillion on data center and AI chip deals.

And monetizing that all of those investments is paramount for the tech companies if they are going to keep Wall Street happy.

Email Daniel Howley at dhowley@yahoofinance.com. Follow him on Twitter at @DanielHowley.

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