Qualcomm bets on AI data centers as its phone sales decline
The chipmaker aims for data centers to eventually make up about 30 percent of its business, a shift away from a phone market that is shrinking.
Qualcomm, whose smartphone sales are reportedly down roughly 20 percent from 2025, is turning toward AI data centers to shore up its results. On its Q4 2026 earnings call the company described a push into this market through partnerships announced earlier this year with Amazon and Meta. It projects about $650 million in data center revenue for the first quarter of 2027, with that figure expected to climb to $5 billion by late 2027 and to $15 billion by 2029. Against total 2026 revenue of $10.4 billion, Qualcomm says data centers could eventually make up around 30 percent of the business. That target is lower than AMD's stated goal of more than 80 percent of revenue from data centers, but it points to strong demand for AI infrastructure.
Why it matters
For readers following the chip industry, the move signals that a major phone-chip supplier now sees its future in AI infrastructure rather than handsets. Qualcomm projects about $650 million in data center revenue for the first quarter of 2027 against $10.4 billion in total 2026 revenue, so the segment would start small. Its target of around 30 percent is well below AMD's goal of more than 80 percent, which shows how far apart the two companies are in their bets on the same market.
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