Amazon’s (AMZN) cloud arm, Amazon Web Services (AWS), has struck a major OneGov agreement with the General Services Administration (GSA) to offer federal agencies up to $1 billion in discounts for cloud services. This deal, set to run through 2028, is a part of the Trump administration’s plan to upgrade government tech and strengthen its use of AI.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
The partnership aims to speed up cloud adoption across many agencies. It will support AI tools like language models and machine learning, and help train government workers. GSA officials say it’s a key part of President Trump’s AI Action Plan.
A Win for Both Sides
For the Trump administration, this deal helps build its AI legacy by starting a long-term upgrade of how the government works. GSA’s acting head, Michael Rigas, said it will help agencies improve services, use cloud and AI tools, and cut costs.
For AWS, the deal significantly expands its role in the federal government, a huge market worth up to $100 billion as agencies shift to cloud technology. AWS CEO Matt Garman called it a major partnership that will boost efficiency now and help create a safer, more innovative government in the future.
Not Just Amazon
This agreement with Amazon is the latest in a series of similar deals the GSA has made to advance government technology. Earlier this week, a deal was struck with OpenAI, giving federal agencies access to ChatGPT for a nominal fee of $1 over the next year.
Last month, a similar agreement was reached with cloud provider Oracle (ORCL) to offer government agencies a 75% discount. It must also be noted that similar deals with other major cloud providers, including Microsoft (MSFT) and Google (GOOGL), are currently in development.
Is Amazon a Buy, Hold, or Sell?
Turning to Wall Street, AMZN stock has a Strong Buy consensus rating based on 43 Buys and one Hold assigned in the last three months. At $264.21, the average Amazon stock price target implies an 18.01% upside potential.
