Synopsys and AWS sign deal worth over $1 billion for chip design licensing

Synopsys and Amazon Web Services announced on Wednesday a multi-year deal worth over $1 billion, as Reuters reports, under which Amazon’s cloud unit will license chip design intellectual property from Synopsys.

According to Reuters, Synopsys is the company that produces the software with which the world’s most complex chips are designed — tools used by giants such as Nvidia and Intel. But in recent years the company has been rapidly expanding a second business: licensing “blueprints”, ready-made designs for chip components, which manufacturers can integrate directly into their products.

This licensing business brought Synopsys $1.75 billion in revenue in the last fiscal year, Reuters writes, and places the company in direct competition with Arm Holdings, the traditional leader of this market.

The deal with AWS will focus precisely on these blueprints, optimized for specific types of chips. The move makes strategic sense for both sides: AWS designs its own chips, including the Graviton processors for data centers and the Trainium artificial intelligence chips.

As part of the deal, Reuters writes, Synopsys will use AWS’s computing and storage services, as well as the Amazon Bedrock platform for its artificial intelligence applications — further deepening the technological partnership between the two companies.