Qualcomm aims to challenge Nvidia's dominance in AI chips, projecting annual sales of data center AI components to exceed $15 billion by fiscal 2029.

BlockBeats News, June 27, according to Fortune, Qualcomm CEO Cristiano Amon is trying to shift the company from being primarily dependent on smartphone chips to diversifying into AI chips, automotive, PCs, smart home, and wearable devices, and to place its next focus on the data center AI chip market, challenging NVIDIA’s long-standing dominance. At an investor day event held in Manhattan this Wednesday, Qualcomm released its latest AI accelerator and CPU product lines. Amon said that people often question whether Qualcomm is already too late in the fiercely competitive AI chip market, but he claims, “For Qualcomm, it is never too late.”

Qualcomm expects that by fiscal year 2029, its annual sales of data center AI components will exceed $15 billion. Driven by this, Qualcomm’s stock price rose by as much as 15% on Wednesday, but as of Friday, most of those gains had already been given back due to the sell-off in Nasdaq’s large-cap tech stocks. Qualcomm also expects that by 2029, annual revenue from businesses other than its phone business will reach $40 billion, double the long-term forecast it made two years ago, showing that the company’s efforts to reduce reliance on smartphone chips are moving forward. Amon said that public concerns about the enormous energy consumption of AI and data centers, in fact, provide an opportunity for Qualcomm to differentiate itself through products such as high-efficiency CPUs.

In addition, Qualcomm announced this week that it will acquire AI software company Modular for $3.9 billion to obtain a software platform that can compete with NVIDIA’s CUDA. CUDA enables developers to build AI programs and fully leverage NVIDIA GPUs, which is also one of the key reasons why many developers continue to stay in the NVIDIA ecosystem; Modular is seen as Qualcomm’s attempt to weaken NVIDIA’s software advantage. Amon said that Qualcomm has a very strong engineering culture and is not afraid to take on brand-new challenges. He said that since 2021, the company has repeatedly pushed for business transformation, including directions such as automotive, PC chips, and industrial applications, and that it is now entering a similar phase.