Amazon Unveils Multi-Generational Chip Partnership with Qualcomm

Qualcomm's stock price surged between 7-10% after Amazon announced a multi-generational partnership to develop custom AI inference chips for its cloud infrastructure.

The deal, announced on September 8, covers multiple generations of custom silicon designed specifically for AI inference workloads inside Amazon's data centers. Qualcomm is leveraging its own SerDes and optical DSP technologies to achieve speeds up to 1.6 terabits per second.

Amazon received a warrant granting it the option to purchase up to 25 million Qualcomm shares at an exercise price of $161.26 per share, representing approximately $4 billion in value. The warrant doesn't expire until September 3, 2036.

This partnership deepens Qualcomm's existing relationship with Amazon on the software side, as it increases its reliance on AWS AI tools like Amazon Bedrock for electronic design automation tasks.