Qualcomm announced Monday a multi-generational product collaboration with Amazon to enable customized silicon at scale for large-scale AI data centers, working together on AI inference and on optical connectivity solutions extending up to 1.6T and future generations. It is the chipmaker's heaviest bet yet on the AI data center market — and a key step away from its identity as a "smartphone chip company."
By Qualcomm's account, AI workloads are growing exponentially, driving unprecedented demand for compute, storage, networking, memory bandwidth, and energy-efficient infrastructure. The collaboration combines Amazon's scale in AI infrastructure with Qualcomm's leadership in power-efficient processing, silicon design, and system-level integration: Qualcomm's advanced SerDes and optical DSP technologies will support high-bandwidth interconnects inside AWS data center networks. As part of the deal, Amazon receives warrants for up to 25 million new Qualcomm shares at $161.26 — worth about $4 billion if fully exercised — while Amazon's purchases of Qualcomm AI silicon could reach as much as $60 billion over a decade. Qualcomm shares surged nearly 10% on the day and closed up around 7%.
Beyond selling chips, Qualcomm plans to deepen its own use of AWS AI infrastructure — including Amazon Bedrock for electronic design automation (EDA) workloads — with a goal of shortening chip design cycles. That makes Qualcomm simultaneously a supplier and a customer of Amazon, tying the two companies together more tightly than ever. Qualcomm CEO Cristiano Amon said in the announcement that data center infrastructure requires simultaneous advances in computing and connectivity: "Qualcomm is pleased to work with AWS on customized silicon and connectivity solutions, bringing decades of leadership in advanced processing and power-efficient compute, to deliver breakthrough performance and enable the next generation of AI infrastructure."
For AWS, the deal adds a heavyweight external supply channel alongside its in-house silicon efforts, and it makes Qualcomm an increasingly unignorable player in the AI inference chip market beyond Nvidia. Qualcomm had previously set a fiscal 2029 data center revenue target of more than $15 billion at its investor day — the Amazon tie-up is the most forceful evidence yet that it intends to hit it.