Qualcomm Enters $4 Billion Deal with Amazon to Develop Custom Chips
Qualcomm has entered a significant partnership with Amazon, agreeing to manufacture custom chips for data centers as part of a $4 billion deal. The collaboration includes the development of multiple generations of silicon optimized for AI inference and optical connectivity capable of speeds up to 1.6 terabits per second. As part of the agreement, Qualcomm issued a warrant allowing an affiliate of Amazon to purchase 25 million shares in the company. The partnership is expected to last over ten years, with potential total purchases by Amazon reaching $60 billion worth of Qualcomm products. This deal aligns with broader industry trends where chipmakers are securing investments from tech giants to support growth amid rising demand for AI infrastructure. The collaboration will leverage Qualcomm's optical digital signature processor technologies and AWS’s Bedrock cloud service. Qualcomm aims to expand its data center business, having already announced a CPU called Dragonfly C1000 with Meta in June. The company plans to grow this segment into over $15 billion by fiscal year 2029.
Topics: AI Infrastructure Custom Chips Data Centers Investment Partnership