Qualcomm Lands Up to $60B Amazon AI Chip Deal as QCOM Stock Rises

Qualcomm on September 8 announced a multi-generational collaboration with Amazon to develop customised silicon for AWS AI data centres, while disclosing that Amazon received an equity warrant whose vesting can be tied to as much as $60 billion in Qualcomm purchases. Qualcomm shares rose more than 5% in morning trading following the announcement, while Amazon shares fell about 1.2% amid wider market weakness.

Amazon’s Qualcomm warrant

Qualcomm said in an SEC filing that Amazon received a warrant to buy up to 25 million Qualcomm shares at an exercise price of $161.26 per share. The filing says vesting is linked to commercial agreements, purchase orders and purchases of Qualcomm products and services, with related payments capped at $60 billion. The $60 billion figure represents the maximum level of purchases tied to the vesting mechanism, not a stated upfront purchase commitment.

AWS AI silicon and connectivity

Amazon and Qualcomm will develop customised silicon for AWS AI data centres, with the initial focus on AI inference, Qualcomm said.

Optical-connectivity solutions are also part of the collaboration, extending to 1.6T and future generations.

Qualcomm called the arrangement multi-generational. Its announcement did not provide financial projections for the collaboration or a launch date for the customised AWS data-centre silicon.

QCOM stock market reaction

Investors initially rewarded the disclosure: Yahoo Finance reported that QCOM gained more than 5% in morning trading on September 8 after the Amazon news.

Amazon shares, meanwhile, declined roughly 1.2% amid broader market weakness, according to Yahoo Finance.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.