Qualcomm Targets $15B in AI Data Center Revenue by 2029, Challenging NVIDIA and AMD

Qualcomm announced a goal to achieve over $15 billion in AI data center revenue by fiscal year 2029, marking a strategic pivot from its core handset business.

This ambition is supported by securing major hyperscaler clients for custom silicon, with initial revenue of "billions" expected as early as fiscal year 2027.

The move places Qualcomm in direct competition with established players like NVIDIA and AMD in the rapidly expanding AI infrastructure market, which is fueled by massive capital expenditures.

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Qualcomm has officially declared its ambition to become a major force in the AI data center market.

At its 2026 Investor Day, the company set a bold target: over $15 billion in data center revenue by fiscal year 2029. This is part of a broader strategy to generate around $40 billion from non-handset businesses, signaling a significant pivot from its legacy as a smartphone chip leader. This move aims to capture a piece of the massive AI infrastructure boom, with hyperscalers projected to spend between $500 and $700 billion on capex in 2026 alone.

This strategic shift didn't happen overnight, though. The groundwork was laid through key acquisitions in late 2025. First, Qualcomm acquired Ventana Micro Systems, which brought in expertise in high-performance RISC-V server CPUs. Soon after, it bought Alphawave Semi, securing crucial high-speed connectivity technology essential for linking processors and accelerators inside data centers. These deals provided the foundational building blocks for the competitive products announced later, like the AI200 and AI250 accelerators.

Furthermore, the credibility of this grand plan was cemented just weeks before the announcement. In May 2026, Qualcomm confirmed it had secured a major hyperscaler as a customer for its first data center chip. This news was a critical turning point, transforming the market's perception of Qualcomm's data center efforts from a speculative venture into a commercially-backed reality. It provided tangible proof of demand and de-risked the timeline for achieving the initial "billions" in revenue projected for fiscal year 2027.

However, the path forward is challenging. The $15 billion target is substantial, representing roughly 90% of AMD's entire data center revenue in 2025. Qualcomm is entering a field dominated by NVIDIA's massive presence and AMD's strong growth. Success will depend not only on technology but also on flawless execution, building a robust software ecosystem, and navigating a highly competitive landscape. Qualcomm's narrative has now been reframed: it's no longer just a mobile giant but a diversified compute supplier aiming for the heart of the AI revolution.

Hyperscaler: A large-scale cloud service provider that operates massive data centers, such as Amazon Web Services (AWS), Google Cloud, and Microsoft Azure.
Custom Silicon (ASIC): Application-Specific Integrated Circuit. A chip designed for a specific purpose, in this case, custom-built by Qualcomm for a hyperscaler's unique AI workloads, offering better performance and efficiency than general-purpose chips.
Capex (Capital Expenditure): Funds used by a company to acquire, upgrade, and maintain physical assets such as property, buildings, and equipment, like the servers and networking gear in a data center.