Qualcomm has secured a contract to supply Amazon with artificial intelligence chips and optical networking hardware. The partnership includes a stock warrant agreement allowing Amazon to purchase up to 25 million shares of Qualcomm, valued at $4 billion, with vesting scheduled through 2036. Some share issuances depend on Amazon purchasing up to $60 billion in Qualcomm products.
The companies will collaborate on developing customized silicon for large-scale AI data centers, focusing on chips optimized for inference workloads. Qualcomm plans to provide multiple generations of these processors. This follows a similar multi-generational contract Qualcomm signed three months ago with Meta Platforms for its Dragonfly C1000 CPU series.
For optical networking, Qualcomm will supply SerDes and DSP technologies to link servers within AI clusters. The CO400 DSP, Qualcomm's advanced model, can transmit data over distances of up to 12 miles and utilizes forward error correction to minimize transmission errors. This aligns with Amazon's broader data center strategy, which includes recent hardware deals with Corning.
As part of the collaboration, Qualcomm will expand its use of Amazon Web Services. The company intends to utilize Amazon Bedrock to run electronic design automation applications, aiming to accelerate its internal product development cycles.
