Qualcomm datacenter revenue target hits $15 billion for fiscal 2029
Qualcomm says datacenter sales could reach $15 billion by fiscal 2029 as Apple modem revenue falls faster than expected.
By Dominic Okoye · Staff Writer
· 3 min read
Qualcomm datacenter revenue could reach $15 billion a year by fiscal 2029, the chip designer told investors alongside third-quarter results that showed pressure in its core smartphone business. The target gives Qualcomm a new growth story as revenue from Apple modems drops faster than management previously expected, but it would still leave the company far behind larger datacenter chip rivals.
Executives said supply-chain constraints will accelerate the reduction in Apple-related revenue because Qualcomm’s expected share of the next iPhone is now materially below its earlier estimate of 20%. Apple has been developing its own modem technology for years, and Qualcomm has long signaled that this business would decline.
Qualcomm now expects less than $2 billion in sales to Apple next year. CFO Akash Palkhiwala told investors that the change “accelerates kind of the exit of Apple revenue out of our model.”
How big could Qualcomm datacenter revenue be in 2029?
The company’s answer is $15 billion in annual sales by fiscal 2029, starting from a business that is effectively new for Qualcomm. Management framed the datacenter push as part of a broader shift away from dependence on handsets, with non-smartphone products expected to generate $40 billion a year by fiscal 2029.
That non-handset forecast includes $10 billion from automotive products and $14 billion from internet of things devices. Qualcomm reported $3.3 billion in non-smartphone revenue in the third quarter and had previously projected $22 billion in annual non-phone revenue for 2029.
The datacenter number is large for Qualcomm, but the comparison set is unforgiving. AMD and Intel each generated more than $16 billion in datacenter revenue in fiscal 2025, according to the figures cited by Qualcomm’s rivals, and both are expanding in the category. Nvidia is on pace for more than $250 billion in annual datacenter revenue.
Qualcomm’s datacenter products will compete with AMD and Nvidia offerings. Management’s plan leans on cheaper inference, the part of AI computing that runs trained models rather than building them. A $15 billion target would mark meaningful diversification for Qualcomm, while also implying a secondary position in a market dominated by incumbents with much larger datacenter businesses.
Apple decline raises pressure on Android and non-phone sales
CEO and president Cristiano Amon also told investors that Qualcomm expects price increases across its product range, citing higher input costs and wafer prices. He said a double-digit increase would be small compared with the memory bill of materials in smartphones, and he blamed weak handset demand partly on the cost of RAM.
Qualcomm is counting on higher revenue from Android handset chips, including support from a recovery in China. Amon said Chinese smartphone sales should improve after vendors cleared built-up inventory and prepare to launch new models with agentic AI features.
For the quarter, Qualcomm reported revenue of $9.95 billion, down 4% from a year earlier. Net income fell 25% to $2 billion. The results were close to the company’s prior expectations, but the Apple outlook and the scale of the datacenter challenge weighed on investors. Qualcomm shares fell about 5% in after-hours trading.
This story draws on original reporting from The Register.
