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Amazon faces depreciation hit as Trainium 2 chips are replaced early
Amazon said it accelerated the retirement of some servers and networking gear to reflect faster AI technology development, citing SEC disclosures and charging roughly $2.2 billion across 2025.
Amazon is adjusting parts of its data center and server buildout plan for its AI infrastructure, according to SEC-linked disclosures described by Yahoo Finance, which say Trainium 2 chips and related equipment have been moved toward earlier replacement.
The company previously detailed that it splits capital spending into two cycles: data centers, with longer useful lives, and the servers and networking equipment inside them, which follow different timing. Amazon also noted in the reporting that building assets are expected to last 30-plus years, supporting multiple generations of server economics over time.
After a useful life study in the fourth quarter of 2024, Amazon cut a subset of servers and networking equipment from six years to five effective January 2025, and it also decided to retire certain servers and networking gear early. In its SEC rationale, the company pointed to an increased pace of technology development, particularly in AI and machine learning.
Those changes carry financial consequences, the report says, including an estimated $700 million reduction to 2025 operating income from the useful life change, about $920 million in accelerated depreciation and related charges for early retirements, and roughly $600 million of additional related charges expected to land during 2025. The article also outlines how Amazon has previously shifted assumed useful lives from three to four years, four to five years, and five to six years before the January 2025 reversal.