Qualcomm has signed a multi-generational data center deal with Amazon Web Services, marking the chipmaker's most significant push yet into AI infrastructure dominated by Nvidia Corp.
Under the agreement, Qualcomm is working with Amazon "across multiple generations of customized silicon" to build out AWS' AI infrastructure, with a specific focus on inference workloads1. Qualcomm filed with the Securities and Exchange Commission that it issued Amazon warrants to acquire 25 million shares at $161.26 apiece, representing a total investment of $4 billion. The shares vest in tranches tied to the execution of certain commercial arrangements and the purchase of up to $60 billion worth of Qualcomm's server chips and other technology.
Qualcomm shares rose on Tuesday following the announcement2.
The deal gives Qualcomm a hyperscaler anchor customer as it attempts to break into a data center market where Nvidia Corp. has been the dominant player during the AI boom. Qualcomm has said it is targeting $15 billion in data center sales in fiscal 2029. The company said in June that Meta would use its central processing unit for data centers, the Dragonfly C1000, when it starts production in 2028.
Bank of America predicts the CPU market could more than double, from $27 billion in 2025 to $60 billion by 2030.
ANALYSIS The warrant structure, with vesting tied to up to $60 billion in chip purchases, aligns Qualcomm's equity upside directly with Amazon's procurement commitments, creating a financial lock-in that goes well beyond a standard supply agreement. With Meta already committed to the Dragonfly C1000 and Amazon now signed on for custom silicon, Qualcomm has secured two of the largest hyperscale buyers as reference customers ahead of its fiscal 2029 revenue target.