Qualcomm, Amazon strike $4 billion custom chip deal
QCOM•Partnership targets AI inference and optical connectivity
The companies will work together on chips for AI inference, a fast-growing market focused on running trained AI models that has become a key battleground among semiconductor firms.
Qualcomm and Amazon will also develop high-speed optical connectivity technologies, including solutions extending to 1.6 terabits per second, to support growing bandwidth demands in AI data centers.
As part of the partnership, Qualcomm plans to expand its use of AWS artificial intelligence services and infrastructure for chip design workloads, aiming to shorten development cycles.
Qualcomm issues warrant to Amazon in custom chip partnership
Qualcomm said on Tuesday it had issued a warrant to Amazon, giving it the right to buy an about $4 billion stake, as part of a collaboration to develop custom chips for AI data centers.
Shares of the San Diego, California-based chipmaker rose more than 7% in early trading. The stock has slipped about 1% this year, as a rebound in August only partly recouped steep losses sparked by weaker smartphone demand.
The warrant lets Amazon buy Qualcomm shares at $161.26 apiece and is linked to up to $60 billion of business under the deal, according to a regulatory filing.
