Qualcomm stock surges 9.5% on Amazon AI deal & 25M share warrant

Shares of Qualcomm Technologies jumped 9.5% after the company unveiled a multi-generational collaboration with Amazon to develop custom silicon and ultra-fast optical connectivity for AI data centers. As part of the agreement, Qualcomm will issue a warrant allowing Amazon to acquire up to 25 million shares of Qualcomm common stock, underscoring a deep, long-term alignment between the two technology companies.

The collaboration will focus on demanding AI inference workloads and optical connectivity running up to 1.6T. With generative AI applications accelerating, the companies say the effort is designed to break through the compute and bandwidth bottlenecks facing next-generation cloud infrastructure.

Custom Silicon and Next-Generation Connectivity at Scale

Under the expanded relationship, Qualcomm will work directly with Amazon Web Services (AWS) to design and deliver energy-efficient custom silicon built for large-scale AI data centers. The initiative pairs AWS's extensive infrastructure with Qualcomm's performance-oriented processing and low-power chip design expertise.

“As AI demand accelerates, data center infrastructure will require advances in both computing and connectivity to deliver greater performance with more efficiency,” said Cristiano Amon, President and CEO of Qualcomm Incorporated. Amon added that the company is drawing on decades of leadership in power-efficient compute to “deliver breakthrough performance and enable the next generation of AI infrastructure.”

At the same time, the two companies are jointly developing high-speed optical connectivity solutions based on Qualcomm's advanced SerDes and optical DSP technologies, aimed at managing rapidly expanding data center traffic. Prasad Kalyanaraman, Vice President at AWS, said the collaboration “builds on a strong foundation of partnership and reflects our shared commitment to pushing the boundaries of what’s possible.”

As part of the broader deal, Qualcomm will also expand its own use of AWS AI infrastructure—including Amazon Bedrock—to power its electronic design automation workflows, with the goal of significantly shortening chip design cycles.