Business Insider reports Amazon receives billions of dollars of Nvidia GB300 racks early, some stored in warehouses due to insufficient power
Business Insider reported on October 20, 2026 that, based on internal emails it reviewed from around August, AWS expected to receive about $5 billion of Nvidia GB300 server racks before their final deployment at U.S. facilities through a new Early Rack Receipt process, and expected to receive about another $3 billion per month for the “foreseeable future.”
The report said some AWS sites had space to place more racks but lacked enough power to turn them on, so finished equipment was temporarily stored in transit warehouses until the facilities were ready. At least one AWS team at the time did “not have a clear forecast path” to move the new racks into data centers. An Amazon spokesperson said temporarily storing finished hardware near deployment sites was “best business practice,” and rejected the claim that the company overall lacked a deployment path. The company expects capital expenditures of about $220 billion in 2026, and free cash flow turned negative last quarter.
A Morgan Stanley report in September estimated that total U.S. data center power demand in 2026-2028 would be about 97 GW, with an original gap of about 57 GW after deducting capacity under construction and available grid capacity; after including behind-the-meter and other solutions, the net gap was about 32-33 GW. The Financial Times reported in early October that Amazon was in talks with investors to sell about $8 billion of Nvidia Grace Blackwell chips to a special purpose vehicle and then lease them back. The report did not confirm that the deal had closed.
Original sources:
Title: Amazon is buying billions in Nvidia AI systems it can't yet turn on Publisher: Business Insider (Eugene Kim) Publication date: 2026-10-20 URL: https://www.businessinsider.com/amazon-nvidia-ai-gpu-data-centers-power-shortages-2026-10 Nature of source: media exclusive report Verification status: full text read for this run; accessed on 2026-10-25 Supported content: Early Rack Receipt, about $5 billion plus $3 billion per month in GB300 racks, temporary storage in warehouses due to insufficient power, spokesperson response, free cash flow turning negative.
Title: Morgan Stanley raises US data-center power shortfall forecast to 33 GW Publisher: Blockspace Publication date: 2026-09-21 URL: https://blockspace.media/insight/morgan-stanley-data-center-shortfall/ Nature of source: media report (citing Morgan Stanley) Verification status: relevant passage read for this run; accessed on 2026-10-25 Supported content: original gap of about 57 GW and net gap of about 33 GW estimate.
Title: Amazon in talks to sell $8bn of Nvidia Grace Blackwell chips... Publisher: YFarmX (citing Financial Times) Publication date: 2026-10-02 URL: https://yfarmx.com/amazon-8bn-nvidia-chip-leaseback/ Nature of source: media report Verification status: relevant passage read for this run; accessed on 2026-10-25 Supported content: talks on selling about $8 billion of chips and leasing them back, free-cash-flow related data.
ABAB AI Insight
Business Insider’s internal emails show that AWS changed its previous practice of taking ownership only when racks arrived at data centers, and instead paid early and received GB300 racks in advance to lock in supply. Some sites could not power them on because of insufficient electricity, so the hardware was stored in warehouses, creating so-called dark GPUs. An Amazon spokesperson described this as routine temporary storage practice rather than evidence of a lack of an overall deployment plan.
On the capital side, the company’s 2026 capital expenditures are expected to be about $220 billion, and free cash flow has already turned negative. The Financial Times report on talks to sell about $8 billion of Grace Blackwell chips and lease them back is intended to move assets off the balance sheet and bring in external financing while retaining usage rights. As of the report, the deal was still in the discussion stage.
Morgan Stanley’s estimates show U.S. data center power demand expanding faster than the grid and under-construction capacity, with an original gap of about 57 GW and a remaining net gap of about 32-33 GW. Behind-the-meter gas generation and other solutions were included in the estimate to narrow the gap, but deployment is constrained by approvals, labor and engineering.
The report does not change the operating status of Amazon’s existing data centers, nor does it confirm that any sale-and-leaseback transaction has closed. Key follow-up points are when the temporarily stored racks are actually powered on, the pace of free-cash-flow recovery, and whether other cloud providers adopt similar early lock-in and off-balance-sheet financing arrangements.
ABAB News · Cognitive Law
Chips can be purchased early to secure supply, but power access determines the computing capacity that is actually usable.
Taking ownership early locks cash into assets that are not yet powered on, accelerating the move into negative free cash flow.
Sale-and-leaseback shifts heavy-asset financing to external sources while retaining usage rights.