Amazon Engineers Move to Cap AI Spending After Cost Overruns

Amazon's engineering teams encountered significant budget overruns when shifting projects from hand-written code to AI models, including a $1.8 million expense on an unshipped task using Anthropic's Claude Sonnet. These overruns, sometimes exceeding budgets by over 800%, led Amazon to develop automated spending caps for future AI projects. The high costs stem from token-based billing models, where repeated or large-scale AI requests can generate unexpectedly large invoices.