Qualcomm’s data center strategy now carries a $15 billion annual-sales target for 2029, an aggressive forecast as the company tries to diversify beyond handset chips. The company announced its Dragonfly data-center roadmap at its June investor day and later said it expected about $650 million in data-center revenue in the first quarter of 2027, according to The Verge.
Those figures are targets, not booked revenue. Qualcomm’s own investor presentation says its product schedules, customer engagements, demand estimates and financial goals are forward-looking statements subject to risks and uncertainty.
Still, the scale is clear. Qualcomm has forecast $5 billion in data-center revenue for fiscal 2027, including $1 billion from new custom-chip customers, Reuters reported. It also forecast $40 billion in chip revenue outside handsets by 2029. The $15 billion data-center goal would represent 37.5% of that non-handset target.
What is Qualcomm’s data-center strategy?
The plan is broader than one server processor. Qualcomm’s announced Dragonfly portfolio includes the C1000 data-center CPU, High Bandwidth Compute technology, the AI300 inference accelerator, connectivity products and custom silicon. Inference is the work of running trained AI models, rather than training them.
The C1000 is not a broadly available product yet. Qualcomm says commercial availability is expected in 2028. The company says it is also working on CPUs, inference accelerators and custom application-specific integrated circuits, or ASICs. Qualcomm frames its approach around performance per watt and lower costs, but those are company claims rather than independently verified results in the available evidence.
For the underlying plumbing, a data center depends on servers, networking, power and cooling. Qualcomm is pitching chips for the compute layer of that operation, with an emphasis on AI workloads and the memory and connectivity required to keep those systems fed with data.
Who has committed to Qualcomm’s chips?
Qualcomm said Microsoft and Meta will use its new AI chips, Reuters reported. It also said it had two additional, unnamed hyperscale customers for custom chips. The public information does not establish order volumes, contract values or how quickly those relationships translate into substantial sales.
Qualcomm’s push comes while its core phone-chip business faces pressure. Reuters reported in April that rising memory prices had increased smartphone and PC costs, causing customers to curb purchases, while Apple and Samsung were increasingly choosing in-house chips. But the company’s chief executive, Cristiano Amon, told Reuters then that he expected the smartphone market to rebound after Qualcomm’s fiscal third quarter. That is a more complicated picture than a permanent handset collapse.
Can Qualcomm reach its 2029 data-center target?
Execution will be the inconvenient part. Reuters described the AI data-center market as fast-growing and highly competitive, with Nvidia, Cerebras, Amazon’s Graviton processors and Google’s Axion chips among the established alternatives. Bank of America analysts estimated Qualcomm’s data-center push could produce roughly $2 billion to $5 billion in annual revenue in fiscal 2027 and 2028, Reuters reported.
Qualcomm is therefore asking investors to judge a multi-year expansion before its flagship C1000 is commercially available. The roadmap is real; the $15 billion outcome remains Qualcomm’s forecast.
This story draws on original reporting from The Verge.
