Qualcomm and Amazon have signed a major partnership to co-develop custom AI chips for data centers. The deal could be worth as much as $60 billion if it hits its full potential. The focus? Hardware for AI inference and blazing-fast optical interconnects capable of up to 1.6 Tbps bandwidth.

Deal Breakdown

This partnership is all about building solutions for data centers that need energy-efficient inference chips and high-speed links to move data between servers and accelerators. The main targets are real-world AI inference and network components that help scale up infrastructure fast.

Development Focus

The companies plan to work on chips specifically for AI inference—the phase where trained models run in production—as well as optical links pushing up to 1.6 Tbps. These kinds of solutions are key for cutting latency and boosting throughput inside massive data center clusters.

Financials

As part of the agreement, Qualcomm is giving Amazon a warrant to buy about $4 billion worth of its shares at $161.26 per share. The potential value of the overall deal is pegged at up to $60 billion. Other terms of the partnership haven't been disclosed.