Amazon in Talks to Acquire AI Firm Descartes for $7 Billion
Translated & summarized from Bizportal by baba
Amazon is in talks to acquire the AI company Descartes for approximately $7 billion, a deal that would surpass Anthropic's earlier consideration of a $6 billion purchase. Descartes, founded by Israeli entrepreneurs, develops AI software for optimizing chip usage and creating simulated environments. The potential acquisition highlights the intense competition in the AI infrastructure sector, with Amazon seeking to bolster its cloud services. While negotiations are ongoing, the final terms and completion of the deal remain uncertain.
The story in 5 lines · by baba
- Amazon is negotiating to buy AI firm Descartes for about $7 billion.
- Anthropic previously considered acquiring Descartes but decided against it.
- Descartes develops AI software for chip optimization and content creation.
- The potential deal values Descartes significantly higher than its last funding round.
- The acquisition is part of a larger competition for AI infrastructure among tech giants.
Amazon is reportedly in negotiations to acquire Descartes, an artificial intelligence company, for approximately $7 billion. These discussions follow Anthropic's earlier consideration of acquiring Descartes for around $6 billion, a deal that ultimately did not proceed in September. Descartes, founded in 2023 by Israeli entrepreneurs and operating from San Francisco, develops AI technologies, including software that enables developers to shift workloads between different types of computer chips. This capability is crucial for optimizing AI model performance and reducing reliance on specific hardware, especially given the high costs associated with advanced AI.
Anthropic had explored purchasing Descartes in August, conducting due diligence, but decided against the acquisition in September. While Anthropic has withdrawn, Amazon has now entered the picture. The potential $7 billion valuation for Descartes represents a significant increase from the $6 billion figure considered by Anthropic. However, the talks with Amazon are not yet a binding agreement, and there is no certainty the deal will be finalized at this price or at all.
Descartes also develops models for creating simulated environments and generating/editing video content, with products like 'Lucey' for real-time video editing and 'Oasis' for generating 3D simulated environments. For Amazon, this potential acquisition could enhance its cloud computing division, Amazon Web Services (AWS), with new software and infrastructure capabilities. The interest from both tech giants underscores the strategic value they place on Descartes' technology.
The potential acquisition of Descartes fits into the broader competition among major tech companies like Amazon, Anthropic, and Google to build AI infrastructure and services. Amazon is investing in cloud services and its own chip development, while Anthropic focuses on its Claude models and the necessary infrastructure. Despite their competitive stances, Amazon and Anthropic have a business relationship, with Amazon being an investor in Anthropic, which in turn uses Amazon's cloud infrastructure and AI chips.
Descartes' valuation has seen a substantial jump, having raised $300 million in May 2026 at a valuation of about $4 billion, with investors including Nvidia. The potential $7 billion acquisition price would represent a roughly 75% increase from its last funding round valuation. However, the final sale price and terms remain uncertain as negotiations are ongoing.
