Qualcomm Teams with Amazon on AI Data Center Partnership
Qualcomm has announced a multi-generational partnership with Amazon to develop customized silicon for artificial intelligence data centers. The deal will cover AI inference and optical connectivity solutions, including 1.6T and future-generation offerings.
KeyBanc views the agreement as positive for Qualcomm, improving visibility into the company's data center ramp and long-term growth. The firm reiterated its Sector Weight rating on Qualcomm with a $160 price target following the announcement.
The partnership also includes an Amazon warrant to buy up to 25 million shares of Qualcomm stock, with vesting tied to up to $60 billion in Amazon revenues over ten years. Qualcomm aims to reach $5 billion in data center revenues by fiscal year 2027 and grow to $15 billion by fiscal year 2029.