Multigenerational partnership grants Amazon stock warrants worth $4bn while boosting Qualcomm’s expansion beyond the smartphone market.
Semiconductor giant Qualcomm has struck a major, multigenerational agreement with Amazon Web Services (AWS) to design and supply custom artificial intelligence silicon and high-speed data centre infrastructure, in a commercial framework that could generate up to $60 billion in business over the coming decade.
As part of the transaction, Qualcomm issued Amazon a warrant granting the cloud giant the right to acquire up to 25 million Qualcomm shares at $161.26 per share—a stake valued at approximately $4 billion. The equity structure mirrors similar commercial arrangements deployed by Amazon across its supply chain to align long-term incentives with key vendors.
The engineering collaboration will focus principally on custom processors for AI inference—the computationally intensive task of running trained AI models to generate real-time predictions and responses. The partnership also extends into high-speed networking, leveraging Qualcomm’s serializer/deserializer (SerDes) and optical digital signal processor (DSP) hardware to deliver 1.6-terabit-per-second (1.6T) optical connectivity solutions inside AWS server racks.
In return, Qualcomm plans to deepen its own technical reliance on cloud computing infrastructure by deploying AWS solutions—including Amazon Bedrock—for its internal electronic design automation (EDA) workloads, aiming to shorten development cycles for future chip designs.
The agreement follows earlier high-profile data centre silicon partnerships with Meta Platforms and Saudi entity Humain, positioning Qualcomm as a serious contender against incumbent suppliers in the rapidly expanding cloud and AI hardware sector.
Amazon joins Microsoft and Meta among hyperscale customers backing Qualcomm’s enterprise push, which the semiconductor vendor expects will help scale its data-center chip revenue to $15 billion by 2029.
The partnership signals progress in Qualcomm’s strategy to diversify beyond smartphones amid the eventual loss of its Apple modem business, rising component costs, and softening consumer handset demand.
The partnership is in line with Qualcomm’s acquisition of AlphaWave worth $2.4 billion last year. The deal brought CEO Tony Pialis on board as Qualcomm’s datacentre chip chief.
