Qualcomm announced a long-term partnership with Amazon to develop and supply custom chips and connectivity solutions for AWS’s artificial intelligence infrastructure. The deal could involve up to US$ 60 billion in purchases and expands competition in the data center component market.
As part of the transaction, Qualcomm granted Amazon rights to purchase up to 25 million shares, with an exercise price of US$ 161.26. The potential value of these rights reaches approximately US$ 4 billion and depends on meeting commercial milestones specified in the contract.
Qualcomm advances beyond smartphones
The manufacturer became best known for mobile processors and modems, but has been accelerating its entry into servers and artificial intelligence. The partnership with Amazon reinforces this strategy and could reduce reliance on the smartphone market at a time of transformation in the semiconductor supply chain.
The joint work foresees multiple generations of custom chips for AI inference, the stage where pre-trained models process new requests. The companies also plan high-speed optical solutions to connect servers and equipment within data centers, where information volume is growing rapidly.
Competition in AI infrastructure
Demand for AI computing has led cloud companies to design their own components and seek alternatives to dominant accelerators. In this scenario, Qualcomm will try to compete for market share with Nvidia, AMD, and custom chip vendors, offering processing and connectivity as part of an integrated platform.
Amazon, for its part, will be able to diversify suppliers and tailor hardware to AWS workloads. The company already develops its own chips, and the new collaboration expands its options to balance performance, power consumption, and cost.
Financial impact and next steps
Qualcomm projects recognizing revenue from the deal starting in the coming quarters and maintains its target to significantly expand its data center business by 2029. The announcement boosted the company’s shares, reflecting expectations that the partnership will open a significant new growth front.
The outcome will depend on project delivery, adoption by AWS, and the pace of data center expansion. Still, the contract places Qualcomm more directly in the race for the infrastructure supporting generative artificial intelligence.
Sources consulted: Reuters and Investopedia. Original text produced by the newsroom at Memória do Gelo.
