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Qualcomm strikes AI chip deal with Amazon, offers right to buy about $4 billion in stock
Reuters • • general
Key Points:
- Qualcomm has granted Amazon warrants worth about $4 billion that vest with product purchases, allowing Amazon to buy Qualcomm shares at $161.26 each, signaling deep financial ties amid the AI boom.
- The partnership focuses on developing chips for AI inference, a rapidly growing market crucial for running trained AI models, with Qualcomm's shares rising over 3% following the announcement.
- Amazon's custom chip business, a significant growth driver for its cloud unit, reported an annualized revenue run-rate exceeding $25 billion by the end of June.
- The deal also includes collaboration on high-speed optical communication technologies, targeting data center bandwidth demands with solutions up to 1.6 terabits per second, expanding Qualcomm's presence in AI infrastructure.
- Qualcomm will increase its use of AWS services for chip design workloads to accelerate development cycles, highlighting the company's integrated approach to compute and optical semiconductor technologies.
