- Qualcomm shares surged as much as 9% after announcing a partnership with AWS
- The stock rose about 10% initially before settling at a 4.84% gain by mid-morning
- Qualcomm will collaborate with AWS on multiple generations of AI infrastructure silicon
Qualcomm shares surged as much as 9% on Tuesday after the chipmaker announced a data centre infrastructure partnership with Amazon Web Services (AWS), giving its push into the booming artificial intelligence market a major boost.
The stock initially jumped about 10% before paring some gains. In real-time trading, Qualcomm was up 4.84% at $176.91 as of 10:05 am ET on September 8, compared with its previous close of $168.74
Under the partnership, Qualcomm will work with AWS across multiple generations of customised silicon aimed at building AI infrastructure, with a particular focus on AI inference, the process of running trained AI models to generate responses and predictions.
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The agreement marks a significant vote of confidence for Qualcomm as it looks to expand beyond its traditional smartphone chip business and challenge Nvidia in the rapidly growing AI infrastructure market.
Qualcomm has been stepping up its data centre ambitions. In June, the company unveiled its Dragonwing C Series C1000 CPU, designed for data centre workloads and agentic AI. It also said Meta plans to use the processor when production begins in 2028.
The chipmaker has set an ambitious target of generating $15 billion in data centre sales by fiscal 2029, supported by a broader product roadmap that includes AI chips and technology designed to connect multiple chips.
The AWS partnership adds another major hyperscaler to Qualcomm's growing list of customers. Amazon, like Meta, is investing heavily in AI infrastructure, with annual capital expenditure running into the hundreds of billions of dollars.
Nvidia has dominated the AI chip market through its powerful graphics processing units, or GPUs, which are widely used to train and run advanced AI models. But the AI infrastructure race is increasingly opening up opportunities for CPUs as well.
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CPUs use fewer but more powerful cores and are suited to general-purpose computing tasks, while GPUs are designed to handle large numbers of operations simultaneously.
Bank of America expects the CPU market to more than double from $27 billion in 2025 to $60 billion by 2030, highlighting the opportunity Qualcomm is targeting.
Intel and AMD are also benefiting from stronger demand for data centre CPUs, while Nvidia has been developing CPUs optimised for newer AI workloads.
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