3M stock rises 3% on $6B Amazon data center deal
Summary
Shares of 3M increased by three percent following a multi-billion dollar agreement with Amazon. The major industrial company will supply products for Amazon's data center infrastructure.
Our Take
This deal gives 3M something it has lacked: a clear AI data center story. 3M will supply Amazon with optical connectivity and other data center products. In return, an Amazon subsidiary gets a warrant for up to about 3.16 million 3M shares at $164.89, and most of it vests only as Amazon's cumulative purchases reach $6 billion. That structure matters, because the dilution only happens if the revenue shows up.
The market liked it. MMM closed Monday at $162.01 but traded near $170.86 after hours, up about 5.5%.
For Tuesday, we are watching whether the gap holds above the October 16 high near $167.95. Holding there keeps buyers in control. A fade back toward the $164.89 warrant strike would suggest traders are selling the pop. It is also a sign that AI spending is spreading beyond chips to the companies that wire data centers together.
Not financial advice.
Opinion of Tech & Money Press. Not financial advice.
Source: Read the full story at Stock Market News