Amazon designing custom AI chips for Echo, Fire TV and future devices, exec tells CNBC

• Amazon's custom AZ3 and AZ3 Pro chips are already deployed in Echo Show 8, Echo Show 11, and Fire TV devices to run AI models locally rather than in the cloud
• The company launched Alexa+ with advanced capabilities to handle complex queries and tie together Amazon's hardware ecosystem from Ring doorbells to Echo devices
• Amazon acquired Bee wearables for $49.99 voice-enabled wristbands and plans to release new 'on-the-go devices' soon, with Panay stating users 'won't have to wait long'

Amazon Developing Custom AI Chips for Consumer Devices

Key Developments:

Amazon is designing proprietary AI chips for its Echo, Fire TV, and future consumer devices, according to hardware chief Panos Panay in an interview with CNBC's "The Tech Download" podcast. The company currently manufactures end-to-end silicon for devices including the Echo Show 8, Echo Show 11, and Fire TV.

Technical Details:

In October, Amazon unveiled the AZ3 and AZ3 Pro chips designed to run AI models on-device rather than in the cloud, enabling faster performance and enhanced security. Panay emphasized that custom silicon is crucial for "critical" devices where tight hardware-software integration is essential for delivering secure, ambient home experiences. Amazon continues to use chips from partners like Qualcomm alongside its proprietary designs.

Strategic Context:

The chip development supports Amazon's Alexa+ platform, launched for general U.S. availability this year. Alexa+ offers advanced capabilities including complex query handling, contextual learning, and user pattern recognition to integrate Amazon's ecosystem of Ring doorbells, Echo devices, and Fire TV products.

Future Product Pipeline:

Panay revealed Amazon has a "whole roadmap of on-the-go devices" and stated users "won't have to wait long" for new products. The company is exploring wearables following its 2024 acquisition of Bee, which produces $49.99 voice-enabled wristbands. Panay suggested future AI devices may move away from traditional apps and screens toward conversation-based interfaces.

Competitive Landscape:

Amazon's Alexa+ competes with OpenAI's ChatGPT and Google Gemini, as the company aims to lock users into its device ecosystem and e-commerce platform.