Amazon is expanding its print-on-demand offerings, with a recent commitment to buy $400 million in products and services from Kornit Digital, an Israel-based manufacturer of high-end direct-to-garment and textile printers. The online retailing giant has a long-standing partnership with Kornit to power its Merch by Amazon services.

This new deal is part of a large public offering of shares by Kornit earlier this month. The company launched an underwritten public offering of 3.6 million ordinary shares, with 2 million (worth $124 million) offered by Kornit and 1.6 million (worth $100 million) offered by an affiliate of Amazon, according to Israeli newspaper Haaretz. Amazon owns 4.75% of Kornit.

Amazon uses Kornit’s industrial direct-to-textile printers to power its Merch by Amazon services.

Proceeds from Kornit’s portion of the stock sale will allow the company to pursue future acquisitions and enter new market segments. “The business is on fire – fashion companies are moving online and to textile printing on demand,” Kornit CEO Ronen Samuel told Haaretz.

Kornit also signed an agreement with Amazon – expanding one the two companies already had – stating that Kornit will issue stock warrants entitling Amazon to 3.1 million shares in the future. To get the warrants, Amazon committed to buying products and services from Kornit over the next five years: $250 million in products and services already purchased and $150 million in future products. The warrants will be portioned out to Amazon each time it hits a $5 million milestone for purchases, according to Haaretz.

Amazon has been using Kornit printers for its Merch by Amazon service for several years. The service lets independent designers sell personalized T-shirts and other items, with Amazon handling production, shipping and collection. This new deal with Kornit will allow Amazon to expand its digitally printed offerings to things like housewares and sports equipment. Amazon will use Kornit’s Presto, an industrial single-step direct-to-fabric printer introduced last year that can be used to print a variety of items, including upholstery and bedspreads.

“The agreement marks a turning point for us – we will be a huge company,” Samuel told Haaretz.

Kornit had already begun expanding its reach prior to the stock sale and renewed agreement with Amazon. In August, the company acquired Custom Gateway, a technology provider of cloud-based software workflow solutions for on-demand production business models. “On-demand production is overtaking traditional retail models, and the producers who harness all available data will win the marketplace,” Omer Kulka, chief marketing officer at Kornit, said in a press release announcing the acquisition. He added that Custom Gateway’s technology will help “give end consumers the products and experiences they expect.”

Kornit’s printers are a common choice among North American apparel decorators that use direct-to-garment printing. An ASI survey last year found that 31% of decorators offer DTG, an increase of nine percentage points from the previous year.