Qualcomm Projects $15 Billion in Data‑Center Chip Sales by 2029, Boosts Overall Chip Revenue Forecast

Rising Demand for AI‑Optimized Processors

Qualcomm Inc., the San Diego‑based chipmaker, said on Thursday it expects to generate $15 billion in data‑center processor sales by 2029. The company also lifted its forecast for non‑handset chip revenue to $40 billion for the same year, up from $22 billion previously.

The revised outlook reflects accelerating demand for artificial‑intelligence workloads and cloud infrastructure upgrades. Qualcomm’s Snapdragon X series, originally built for smartphones, is being repurposed for server‑grade performance. Analysts note the move diversifies the firm’s revenue base, which has been dominated by handset chips for decades. The company plans to invest heavily in custom silicon that can handle high‑throughput matrix calculations, a core requirement for generative AI models. Its stock rose more than 13 percent in after‑hours trading, underscoring investor optimism.

Data‑center operators are scrambling for chips that can deliver AI inference at lower power and cost. Qualcomm’s new offerings promise a blend of high efficiency and integrated networking, traits prized by hyperscale providers. The firm’s engineering team highlighted a new architecture that merges compute, memory, and interconnect on a single die. Early benchmarks suggest comparable performance to rivals at a fraction of the power draw. If these claims hold, Qualcomm could capture a meaningful slice of the market that currently favors Nvidia and AMD.

Will Qualcomm’s Data‑Center Strategy Disrupt Established Players?

The shift raises questions about how entrenched vendors will respond. Qualcomm’s entry could spur price competition, forcing incumbents to accelerate their own efficiency roadmaps. However, the company lacks the deep server‑grade ecosystem that long‑time players have cultivated. Success will depend on forging partnerships with major cloud providers and securing software support for its custom instruction sets. Moreover, regulatory scrutiny over chip design patents may pose hurdles.

If Qualcomm meets its revenue targets, the company will reduce its reliance on the volatile smartphone market and gain a foothold in a high‑growth segment. The broader industry could see a more diversified supplier landscape, potentially lowering costs for AI services. Investors will watch quarterly reports for signs that the data‑center line is moving beyond pilot projects into full‑scale production.

Frequently Asked Questions

What drives Qualcomm’s confidence in reaching $15 billion by 2029? The firm points to rising AI workloads, early customer commitments, and a roadmap that promises higher performance per watt than current server chips.

How will this forecast affect Qualcomm’s overall business strategy? A stronger data‑center portfolio reduces dependence on handset sales, allowing the company to balance revenue streams across multiple technology segments.

Are there risks that could derail the projected growth? Potential obstacles include intense competition, the need for ecosystem support, and possible delays in mass‑producing the new silicon designs.