Qualcomm expects its data centre business to generate roughly $5 billion in revenue next fiscal year, up sharply from $300 million this year, as it expands into custom chips, CPUs, AI accelerators and connectivity.
Chief financial officer and chief operating officer Akash Palkhiwala told CNBC-TV18 the company sees a roughly $1 trillion total addressable market in data centres and aims to capture 5% of it, equivalent to $50 billion.
"This market is expanding in a big way," Palkhiwala said, pointing to customers seeking alternative suppliers with technology expertise and scale.
The push comes as Qualcomm's Apple business weakens; Palkhiwala said Apple-related revenue will decline over the next 12 to 18 months, with growth in data centres and automotive expected to replace it within a year.
Qualcomm is targeting an AI accelerator market dominated by Nvidia's GPUs, betting that data centres will shift toward specialised, disaggregated computing rather than using GPUs for every workload.
Palkhiwala said the company's experience delivering high performance at low power on edge devices, combined with a technology it calls high-bandwidth compute, could give it an edge as power consumption becomes a bigger constraint for data centre operators.
Qualcomm's automotive business is expected to exit the current fiscal year at a $7 billion run rate, with a target of about $10 billion by 2029, built on partnerships including Mahindra, Tata and Maruti.
The company is also raising prices as foundry, test and packaging capacity runs tight across the semiconductor supply chain, and said most customers understand the reasoning behind the increases.
