Qualcomm shifts focus to data centers amid smartphone sales slump
What's the story
Qualcomm is shifting its focus to data centers in response to a 20% decline in smartphone sales compared to last year. The company announced its plans during the Q4 2026 earnings call, emphasizing its ambition to make a mark in the AI data center sector. Qualcomm has already partnered with tech giants Amazon and Meta earlier this year for this purpose.
Revenue forecast
Data center revenue projections for Qualcomm
Qualcomm anticipates its data center business will grow rapidly, expecting around $650 million in revenue from this segment in Q1 2027.
The company expects this figure to balloon to $5 billion by the end of 2027 and reach a whopping $15 billion by 2029.
Given that Qualcomm's total revenue for 2026 was $10.4 billion, these projections indicate a major shift toward data centers as a key revenue driver.
Business strategy
Data centers to make up 30% of Qualcomm's business
Qualcomm has also revealed its plans for the future, saying it expects data centers to make up about 30% of its business.
While this is not as aggressive as AMD's goal of getting over 80% of its revenue from data centers, it still shows a strong demand in this sector.
The company's shift toward data centers comes amid a broader demand in this sector.