Qualcomm announced plans to reach $15 billion in AI data center revenue by 2029, targeting accelerator and AI chip markets.
Qualcomm has announced ambitious plans to establish itself as a major player in AI infrastructure, projecting $15 billion in annual AI data center chip revenue by fiscal 2029. The company also raised its non-handset semiconductor revenue target to $40 billion by the same year—nearly double its earlier projection of $22 billion. These targets, revealed during Qualcomm's Investor Day presentation, signal a significant pivot away from smartphones: by the end of the decade, the company expects handsets to account for only about one-third of its semiconductor revenue.
The company has already secured backing from major technology firms. Meta and Microsoft are among the early adopters of Qualcomm's AI chips, and two additional hyperscale cloud providers have reportedly committed to using Qualcomm's custom AI silicon solutions. These partnerships demonstrate traction for Qualcomm's data center expansion and suggest growing industry appetite for AI hardware alternatives beyond current market leaders.
To support its ambitions, Qualcomm is developing new High Bandwidth Compute (HBC) processors and the Dragonfly C1000 CPU, both designed specifically for AI data center workloads. The company is also pursuing three key product categories: central processing units, AI inference accelerators, and application-specific integrated circuits (ASICs), all aimed at hyperscale cloud providers, enterprise customers, and firms building large-scale AI infrastructure. A core competitive advantage Qualcomm emphasizes is energy efficiency, drawing on decades of expertise developing power-efficient mobile processors to deliver lower operating costs at scale.
Despite the ambitious roadmap, Qualcomm faces formidable competition. Nvidia currently dominates the AI infrastructure market, with its chips and software ecosystem powering much of today's generative AI workloads. AMD, Broadcom, and custom silicon efforts from major cloud providers also pose significant challenges. Still, Qualcomm believes there is room in the market for solutions optimized for performance-per-watt efficiency and reduced operating costs.
The market responded positively to Qualcomm's announcements. The company's shares jumped in after-hours trading following the Investor Day disclosures, and the updated forecasts and AI roadmap sparked a broader rally across semiconductor stocks. Investors appeared encouraged by Qualcomm's long-term diversification strategy and its positioning within one of the fastest-growing segments of the semiconductor industry.