Amazon is focusing on building chips for its “core” consumer devices, the hardware company’s top executive told CNBC.
In an extensive interview on CNBC’s “The Tech Download” podcast, Panos Panay, head of devices and services at Amazon, discussed, for the first time, the company’s approach to semiconductors in its hardware and how it is experimenting with different types of AI-powered gadgets.
“We make our own end-to-end silicon for the devices we ship,” Panay said.
He said Amazon’s custom silicon is in devices like the Echo Show 8, Echo Show 11 and Fire TV.
In October, Amazon introduced the AZ3 and AZ3 Pro chips designed to run AI models on the device instead of in the cloud. Many device makers see AI running locally as faster and more secure.
Panos Panay, senior vice president of devices and services at Amazon.com Inc., speaks during an Amazon product event in New York, US, on Tuesday, September 30, 2025.
Michael Nagle Bloomberg | Getty Images
Some hardware manufacturers like it an apple designed their own chips, which would give a consumer electronics company more control over the integration of hardware and software.
“For some of the most important devices right now, our focus is on end-to-end silicon, because your point is, if you really want that connection of hardware and software … and if we’re going to deliver this experience around the home to people in a very safe way, we definitely need to think about how that end-to-end delivery of the hardware comes together,” said Panay.
Panay added that the company still uses chips for companies like Qualcomm.
For Amazon, the focus on custom chips is part of a broader push to improve AI in devices.
Amazon launched Alexa+ for general availability in the US this year. Alexa+ is a souped-up version of Amazon’s digital assistant, which can handle complex questions and tasks. Alexa+ can learn context and patterns of users. Amazon has a range of hardware from doorbells to Echo Devices and Fire TV. Alexa+ is intended to help users integrate all their Amazon products.
What Panos Panay says about future AI gadgets
As Amazon’s digital assistant gets more advanced capabilities, Panay said he’s thinking about how users will interact with the devices and what that means for future gadgets.
“I think we may be moving away from a world of apps and screens,” Panay said, adding that “conversation and context” will become more important for AI assistants.
Asked what kind of gadgets the company was working on, Panay said: “If you think about the future of AI machines, you should be very skeptical right now of anyone who tells you they know what they are. I have a lab full of equipment.”
Last month, Qualcomm CEO Cristiano Amon told “The Tech Download” that the company was working on 40 new AI-powered devices as consumer electronics companies look for the next big hit after the smartphone.
Alexa+ will continue to compete with offerings from ChatGPT and OpenAI and Google Gemini which also tracks consumer experiences. Google is using the reach of the Android operating system to gain more users, while companies like Samsung are building many of their AI features into Gemini models.
For Amazon, Alexa+ is the company’s way of locking users into its ecosystem of devices and e-commerce.
Last year, Amazon made a big profit in wearables when it acquired Bee, a company that makes $49.99 wristbands that can understand voice and make lists, answer questions and draft notes.
Panay said there is a “whole road of devices on the way.” The official described these devices as gadgets that people carry around, collect data and people talk to.
“So when you go back home or at work, that communication is always relevant and meaningful,” said Panay.
He added that “you won’t have to wait long” for an Amazon product like this one.
