Qualcomm signed a long-term agreement with Amazon Web Services covering up to $60 billion in custom AI data-center chips, the companies announced September 8. As part of the deal, Qualcomm issued Amazon a warrant to acquire up to 25 million shares at $161.26 each, a potential stake worth roughly $4 billion that vests as purchase milestones are hit.
The partnership centers on AI inference workloads and multiple future generations of custom silicon, alongside optical connectivity technology reaching 1.6 terabits per second to handle growing data-center bandwidth demand. Qualcomm said it is already in production with Amazon and expects the deal to start generating revenue in the December 2026 quarter. Qualcomm shares rose more than 3% on the news.
The agreement marks Qualcomm's push to diversify beyond smartphones as its Apple modem business shrinks and handset demand stays weak, with a stated goal of $15 billion in data-center chip revenue by 2029. "The deal is exactly the kind of development that Qualcomm needed to reassure the market that the lofty data-center ambitions they set for themselves could indeed be met," said Bob O'Donnell, chief analyst at TECHnalysis Research. Qualcomm joins Microsoft and Meta as major cloud customers for its silicon.