Qualcomm and Amazon signed a long-term deal to make custom chips for Amazon Web Services. Reportedly, the deal is worth up to USD 60 billion, though there’s no official revelation of the exact monetary exchange. Some reports say that Amazon did not place an order for the same amount. According to reports, the deal will allow Amazon to acquire 25 million Qualcomm shares at USD 161.26 each.
On September 3, Qualcomm issued an Amazon affiliate a warrant to acquire up to 25 million Qualcomm shares at an exercise price of USD 161.26 a share. Notably, the warrant will expire on 3 September 2036 and can be exercised without cash.
The partnership will focus on chips for large AI systems and fast optical connections. Qualcomm is looking beyond smartphones as its phone chip business faces pressure. Its handset revenue fell 19.6% year over year in the June 2026 quarter. The company wants its data center business to cross USD 15 billion in revenue by fiscal 2029. Amazon, meanwhile, will continue using its own Graviton, Trainium, and Nitro chips alongside Qualcomm's technology.
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Qualcomm is stepping into a market that is dominated by NVIDIA. NVIDIA built a huge business around AI chips and reported USD 89 billion in data center revenue in its latest quarter. Amazon also has its own AI chips, which may make the fight tough for Qualcomm.
The Amazon deal gives Qualcomm a major customer base and a chance to show what its chips can do in a wider sector. Still, a single deal is hardly enough to compete with NVIDIA. This partnership may help Qualcomm reduce its dependency on smartphone chips, but the early data center deals may bring lower profit than its phone business.
The USD 60 billion figure sounds massive, but it is not guaranteed revenue. Future orders will decide how much business Qualcomm actually gets from Amazon. For now, the deal gives Qualcomm a strong entry into the fast-growing AI chip market.