Amazon Inks $1B SNPS Deal to Power AWS Custom Chips: Should You Hold?

Amazon AMZN has deepened its custom silicon push by signing a strategic, multi-year intellectual property agreement with Synopsys SNPS, valued at more than $1 billion, to accelerate chip design for Amazon Web Services (AWS). Amazon will serve as the lead customer for Synopsys’ application-optimized silicon IP and expand its use of Synopsys’ electronic design automation, simulation and agentic AI tools. The deal builds on a collaboration spanning more than 15 years and supports Amazon’s purpose-built chips, including Nitro for cloud security and networking, Graviton for general-purpose computing and Trainium for AI training and inference.

Custom silicon is becoming a key AWS differentiator. The companies will accelerate multiphysics solutions on Trainium and Graviton and apply AI across silicon-to-system engineering workflows. Synopsys will adopt Amazon EC2 and Amazon Bedrock for its own product development, creating a two-way commercial relationship. Amazon’s chips…