Qualcomm Pivots to Data Centers Amid Smartphone Sales Decline

Qualcomm is making a significant strategic pivot, directing its resources towards the rapidly expanding data center market, particularly in the realm of artificial intelligence. This shift comes as the company grapples with a substantial decline in smartphone sales, which have reportedly tanked by around 20 percent compared to 2025. During its Q4 2026 earnings call, Qualcomm unveiled ambitious plans to establish a strong foothold in the AI data center business. The company has already forged key partnerships with major players such as Amazon and Meta, initiatives that were announced earlier in the year. Qualcomm anticipates rapid growth from this new segment of its operations. The company forecasts approximately $650 million in data center revenue during the first quarter of 2027. More impressively, it expects this figure to surge to $5 billion by the end of 2027 and further escalate to $15 billion by 2029. This aggressive expansion into data centers is a crucial move for Qualcomm, especially considering its total revenue for 2026 stood at $10.4 billion, highlighting the need for new growth engines.