Qualcomm said on Tuesday it had issued Amazon a warrant to buy about $4 billion worth of its shares as part of a partnership to develop custom chips for artificial intelligence data centres.
Qualcomm shares rose more than 7% in early trading following the announcement.
The warrant allows Amazon to purchase Qualcomm shares at $161.26 each and is linked to up to $60 billion in business under the agreement.
The companies will develop chips for AI inference, which involves running trained AI models, as well as high speed optical connectivity technology capable of supporting speeds of up to 1.6 terabits per second.
Qualcomm will also expand its use of Amazon Web Services AI infrastructure for chip design, with the companies aiming to accelerate development and meet growing demand from AI data centres.
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