Key points
- Qualcomm expects data centre chips to eventually account for 30% of its total business.
- The company forecasts $5bn in data centre revenue for 2027 and $15bn by 2029.
- Smartphone sales are reported to be tanking by around 20% compared to 2025 levels.
Qualcomm outlined a strategic shift toward data centre infrastructure during its Q4 2026 earnings call, according to the published report The company stated that data centre chips will eventually account for approximately 30 percent of its total business.reported
The evidence
The Verge reported that Qualcomm anticipates smartphone sales to decline by roughly 20 percent relative to 2025 figures.reported To help boost its bottom line, the firm highlighted partnerships with Amazon and Meta, which were announced earlier in the year. These collaborations form the basis of its entry into the AI data centre market.
The decision
Qualcomm provided specific revenue forecasts for its data centre division during the earnings discussion. The company expects to generate around $650 million in data centre revenue in the first quarter of 2027.reported It further projected that this figure would rise to $5 billion by the end of 2027 and reach $15 billion by 2029.
What to make of it
These figures represent a significant portion of Qualcomm's earnings, particularly given its total revenue of $10.4 billion in 2026.reported The 30 percent target is less ambitious than AMD's expectation that over 80 percent of its revenue will eventually come from data centres.reported This contrast suggests a fragmented market with substantial demand for multiple suppliers.
In practice
For startup founders evaluating infrastructure partners, Qualcomm's roadmap indicates a growing availability of AI-focused silicon outside the traditional server CPU market. Access to this hardware will depend on the execution of its announced partnerships with major cloud providers like Amazon and Meta. Limitations include the current revenue scale, which is still nascent compared to established competitors, and the reliance on future market adoption to meet the 2029 targets.reported
Why it matters
- Startups may gain access to alternative AI chip suppliers if Qualcomm's data centre division scales as projected.
- The 20% smartphone sales decline highlights a shifting revenue model for major chip vendors, potentially affecting long-term R&D stability.
- The $15 billion revenue target by 2029 signals significant capital allocation toward data centre infrastructure development.
- Competition with AMD's higher revenue share expectation suggests a contested market for AI hardware supply.
Topics: Qualcomm, AI hardware, data centres, revenue forecasts, semiconductor industry
Updated
Then / now / next
Qualcomm's business was primarily driven by smartphone sales, which are now reported to be declining.
The company is looking to data centres to help boost its bottom line.
Investors will watch whether the $650 million Q1 2027 revenue forecast materialises.
Story timeline
- Then Qualcomm's business was primarily driven by smartphone sales, which are now reported to be declining.
- 04 Nov 2026 Qualcomm is betting big on data centers as smartphone sales sink
- Now The company is looking to data centres to help boost its bottom line.
- Next Investors will watch whether the $650 million Q1 2027 revenue forecast materialises.
The strongest doubt
Counterpoint from the sources
Qualcomm's 30 percent data centre target is significantly lower than AMD's expectation of over 80 percent revenue from data centres.
For readers
Investors
- Qualcomm projects $15bn in data centre revenue by 2029 to help boost its bottom line.
- The company expects data centres to eventually account for 30% of its total business.
Developers
- Partnerships with Amazon and Meta may expand access to Qualcomm's AI silicon.
- Current data centre revenue is projected at $650m for Q1 2027, indicating early-stage availability.
Policy
- The shift reflects broader industry trends in AI infrastructure investment.
- Competition between Qualcomm and AMD suggests a diverse supply chain for AI hardware.
Numbers in context
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Your choice stays on this device. No public tally.Questions readers ask
When does Qualcomm expect to reach $15 billion in data centre revenue?
Qualcomm projects reaching $15 billion in data centre revenue by 2029.
How does Qualcomm's data centre target compare to AMD's?
Qualcomm expects data centres to eventually account for 30% of its business, while AMD expects over 80% of its revenue to come from data centres.
What partnerships support Qualcomm's data centre strategy?
Qualcomm cited partnerships with Amazon and Meta, announced earlier in the year, as key to its data centre plans.
Connected stories
Reading receipt
- Qualcomm expects data centre chips to eventually account for 30% of its total business.
- The company forecasts $5bn in data centre revenue for 2027 and $15bn by 2029.
- Smartphone sales are reported to be tanking by around 20% compared to 2025 levels.
Still open: How will the initial $650 million Q1 2027 revenue compare to actual market uptake?
Still open: Will Qualcomm's 30 percent target remain steady as AMD pursues an 80 percent share?