AWS AI Factories represent a significant shift in how large-scale artificial intelligence is deployed for enterprise and government clients. While traditional AI development happens in the public cloud, these “factories” are installed directly inside the customer’s existing data center. AWS manages the entire stack—including hardware, software, and networking—essentially creating a private AWS Region under the customer’s roof. This model is specifically designed for organizations with rigorous regulatory or security requirements that prevent them from moving proprietary data to external cloud environments.
The system utilizes a shared-responsibility model: the customer provides the physical facility and power, while AWS handles the installation, maintenance, and operational management of the hardware. This setup ensures that no data leaves the building and that hardware is not shared with other customers. By bringing the “cloud experience” on-premises, AWS aims to remove the technical barriers that have previously slowed down AI adoption in highly regulated sectors like finance, healthcare, and national defense.
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Flexible hardware and integration
The AI Factories are built using a combination of Amazon’s proprietary technology and high-end components from Nvidia. Customers have the choice between using Nvidia’s latest Blackwell GPUs or Amazon’s homegrown Trainium3 accelerators for their workloads. The infrastructure includes petabit-scale networking and high-performance storage solutions, such as Amazon FSx for Lustre, which are necessary for training the world’s most complex AI models.
Integration with existing AWS services is a key part of the offering. Even though the hardware is located on-premises, users can still access familiar tools like Amazon Bedrock for model marketplaces and Amazon SageMaker for model building and training. This allows developers to use the same workflows they are accustomed to in the public cloud while keeping the actual data processing local. The system is also designed to be “sovereign,” meaning it helps governments meet specific geographic and legal requirements for where data is stored and processed.
Release and pricing information
AWS officially introduced AI Factories during its re:Invent conference in late 2025, with global availability expanding throughout 2026. This launch is accompanied by a massive $50 billion investment plan by Amazon to build specialized AI and high-performance computing infrastructure, including dedicated federal data centers for the US government that are scheduled to break ground in 2026.
While AWS has not publicly disclosed a standard “sticker price” for the on-premises AI Factories, the service is positioned as an enterprise-grade solution. Pricing is highly customized based on the scale of the deployment, the choice of AI accelerators (Nvidia vs. Trainium), and the specific management services required. Industry analysts suggest that while the initial setup costs may be significant, the model helps organizations avoid the massive capital expenditure (CapEx) of building their own independent AI infrastructure from scratch. AWS manages the ongoing updates and maintenance, providing a more predictable operational expense (OpEx) for the client.
