Track market-moving stories before they get noisy

For most of the AI boom, investors have sorted semiconductor companies into neat categories.

NVIDIA Corp. (NASDAQ:NVDA) dominated AI accelerators.

Qualcomm Inc. (NASDAQ:QCOM) stayed trapped in the “smartphone chipmaker” bucket.

Citrini Research argues that classification may soon become outdated. The business underneath Qualcomm is turning into something else.

• Qualcomm stock is showing weakness. Why is QCOM stock trading lower?

Qualcomm Is Trying To Attack AI’s “Memory Wall”In the latest edition of its Citrini Semis Substack, Citrini Research highlighted that Qualcomm’s transformation extends far beyond smartphones.

The firm said the company is making a credible push into AI infrastructure — a market many investors still aren’t pricing in.

Instead, it’s attempting to solve one of artificial intelligence’s biggest bottlenecks: the exploding cost of moving data between memory and processors.

The investment thesis doesn’t revolve around another AI accelerator.

It revolves around architecture.

Citrini argues that today’s AI infrastructure faces a growing “memory wall,” where processors have become dramatically faster while memory bandwidth struggles to keep up.

High-bandwidth memory has become the industry’s preferred solution, but soaring costs are creating incentives to pursue alternative architectures.

“HBM isn’t an immutable requirement, it’s just the industry’s current answer to the cost of moving enormous amounts of data back and forth between memory and the accelerator,” Citrini wrote.

The firm believes Qualcomm’s newly introduced High Bandwidth Compute (HBC) architecture could become one of those alternatives.

Instead of relying on traditional HBM packaging, Qualcomm places compute directly beneath LPDDR memory, reducing data movement while avoiding expensive advanced packaging technologies.

According to Qualcomm executive Tony Pialis, the architecture delivers significantly higher bandwidth efficiency while reducing power consumption.

If successful, Qualcomm wouldn’t simply be selling another AI chip.

It would be attacking one of AI infrastructure’s largest cost centers.

Why Investors Should Focus On 2029, Not Next QuarterSkeptics argue that Qualcomm’s data center business remains years away from contributing meaningful revenue.

Citrini acknowledges that point but says investors are focusing on the wrong timeline.

Citrini acknowledges that production timelines remain early, with AI200 systems arriving this year and larger hyperscaler deployments expected later this decade.

Semiconductor stocks are routinely valued years ahead of realized earnings, and the firm said 2028 and 2029 are “precisely the year we are putting multiples on this.”

Qualcomm does not need billions in AI revenue today. It needs investors to believe those revenues are becoming credible.

The pieces have been bought rather than built.

Qualcomm closed a $2.3 billion acquisition of Alphawave in December and agreed in June to buy AI software firm Modular for roughly $3.9 billion.

Where Does Wall Street Stand?According to Benzinga Analyst Ratings, the consensus on Qualcomm is Neutral, with an average price target of $207.93. That implies roughly 22% upside from the July 22 close of $171.11, with targets running from $100 to a Street-high $300.

Qualcomm reports fiscal third-quarter results on July 29.

Photo: Shutterstock

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Wall Street expects a year-over-year decline in earnings on lower revenues when Qualcomm (QCOM - Free Report) reports results for the quarter ended June 2026. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.

The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on July 29. On the other hand, if they miss, the stock may move lower.

While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise.

Zacks Consensus EstimateThis chipmaker is expected to post quarterly earnings of $2.22 per share in its upcoming report, which represents a year-over-year change of -19.9%.

Revenues are expected to be $9.71 billion, down 6.3% from the year-ago quarter.

Estimate Revisions TrendThe consensus EPS estimate for the quarter has been revised 0.98% lower over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.

Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change.

Price, Consensus and EPS Surprise

Earnings WhisperEstimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. Our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction) -- has this insight at its core.

The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.

Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.

A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.

Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).

How Have the Numbers Shaped Up for Qualcomm?For Qualcomm, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -0.58%.

On the other hand, the stock currently carries a Zacks Rank of #3.

So, this combination makes it difficult to conclusively predict that Qualcomm will beat the consensus EPS estimate.

Does Earnings Surprise History Hold Any Clue?Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number.

For the last reported quarter, it was expected that Qualcomm would post earnings of $2.57 per share when it actually produced earnings of $2.65, delivering a surprise of +3.11%.

Over the last four quarters, the company has beaten consensus EPS estimates four times.

Bottom LineAn earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss.

That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

Qualcomm doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

In the latest close session, Qualcomm (QCOM - Free Report) was down 3.2% at $178.10. This move lagged the S&P 500's daily gain of 0.38%. On the other hand, the Dow registered a gain of 0.02%, and the technology-centric Nasdaq increased by 0.9%.

The stock of chipmaker has fallen by 16.68% in the past month, lagging the Computer and Technology sector's loss of 1.5% and the S&P 500's gain of 1.27%.

The upcoming earnings release of Qualcomm will be of great interest to investors. It is anticipated that the company will report an EPS of $2.21, marking a 20.22% fall compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $9.7 billion, showing a 6.46% drop compared to the year-ago quarter.

QCOM's full-year Zacks Consensus Estimates are calling for earnings of $10.77 per share and revenue of $42.67 billion. These results would represent year-over-year changes of -10.47% and -3.32%, respectively.

Investors should also note any recent changes to analyst estimates for Qualcomm. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.06% lower within the past month. Qualcomm presently features a Zacks Rank of #3 (Hold).

Looking at valuation, Qualcomm is presently trading at a Forward P/E ratio of 17.09. For comparison, its industry has an average Forward P/E of 45.9, which means Qualcomm is trading at a discount to the group.

Meanwhile, QCOM's PEG ratio is currently 4.05. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The average PEG ratio for the Electronics - Semiconductors industry stood at 1.75 at the close of the market yesterday.

The Electronics - Semiconductors industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 43, positioning it in the top 18% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow QCOM in the coming trading sessions, be sure to utilize Zacks.com.

Since the start of the AI boom in 2023, there have been several moments where the narrative around the buildout and long-term potential of this emerging technology has swung sharply from exuberance to doubt. Over the last few weeks, we appear to have entered another one of those doubt phases.

But it is important not to lose sight of how far this theme has come, not just over the last three years, but even over the last three months. In April, equities looked like they were entering a broader correction as geopolitical tensions flared and risk appetite deteriorated. Yet just weeks later, stocks found their footing and rallied aggressively.

That move was led by technology, AI-adjacent stocks, and, most notably, semiconductors. The SOXX semiconductor ETF more than doubled from those lows, while some of the biggest winners in the group, such as Micron Technology ((MU - Free Report) ), rallied more than 300% from depressed levels.

That kind of move naturally invites a reset.

Image Source: TradingView

The “Narrative Pendulum” is a concept I picked up from analyst Alex Barrow, and I think it is a useful framework for understanding this market (detailed here). The basic idea is that even when a powerful secular trend remains intact, the market’s perception of that trend can swing dramatically between extremes. In the case of AI, investors move from believing the opportunity is nearly unlimited to worrying that the entire buildout is excessive, wasteful, or unlikely to generate adequate returns.

That is where we are now. Concerns around overspending, capital misallocation, falling LLM costs, hyperscaler margins, and the ultimate return on invested capital are beginning to weigh on the AI trade. These concerns are not necessarily fatal to the long-term thesis. In fact, they are probably healthy. Periods of doubt help cool the kind of speculative enthusiasm that can drive prices almost straight higher and create a more durable base for the next leg of the cycle.

I continue to believe the AI boom has room to run, but a pause or correction here would not be surprising.

That brings me to Qualcomm ((QCOM - Free Report) ), a major player in the semiconductor industry that, until recently, has been best known as the dominant force in mobile chips. That remains a core business for the company, but smartphones are now a mature market. As a result, Qualcomm has increasingly been viewed as a slower-growth, more cyclical, and somewhat commoditized semiconductor company, not unlike how Micron was viewed in the memory space a little over a year ago.

That perception may now be changing.

A couple of weeks ago, at the company’s investor day event, Qualcomm management announced a significant pivot in the company’s strategic direction. While the company had been hinting at a larger role in AI over the last several months, the investor day made that shift far more explicit. Management unveiled a broader slate of AI-related business verticals, major hyperscaler relationships, and a much more ambitious vision for Qualcomm’s role in the AI infrastructure stack.

The key takeaway is that Qualcomm is not simply trying to enter the AI sector with one product. It is trying to position itself as a broader AI infrastructure platform.

That could include chips, connectivity, edge AI, inference capabilities, custom silicon opportunities, and data center acceleration. In other words, Qualcomm appears to be moving from being primarily viewed as a mobile-chip company to something closer to an “AI factory accelerator” — a company that helps hyperscalers and enterprise customers build, connect, optimize, and scale the infrastructure required for AI workloads.

I have many thoughts on this evolution, which I will detail more fully, but the timing of the announcement has been somewhat unfortunate in the short to medium term. Qualcomm unveiled this strategic pivot just as the semiconductor narrative began to swing from exuberance back toward skepticism. The stock initially reacted strongly to the news, but has since faded to multi-month lows.

In my view, that weakness has less to do with Qualcomm’s specific developments and more to do with the broader industry pullback. The market is currently questioning the entire AI infrastructure trade, and Qualcomm is being dragged into that reset despite potentially having just laid out one of the more important strategic transitions in its recent history.

If Qualcomm can successfully execute on this pivot, the stock may no longer deserve to trade primarily as a mature mobile-chip company. Instead, investors may begin to revalue it as a broader AI infrastructure beneficiary with exposure to hyperscalers, edge AI, data center acceleration, and next-generation compute demand.

The timing may be unfortunate, but the setup is becoming increasingly interesting.

Scope of Qualcomm’s EndeavorsThe financial targets alone show how ambitious Qualcomm’s AI pivot has become. Management is targeting $5 billion in data center revenue by fiscal 2027 and $15 billion by fiscal 2029, with the early ramp expected to come largely from custom silicon and connectivity before the company’s accelerators and server CPUs become bigger contributors.

That is a major shift for a company still mostly viewed through the lens of smartphones.

At the center of the strategy is Qualcomm Dragonfly, the company’s new data center platform. Dragonfly is not one product, but a layered portfolio that includes connectivity silicon from the Alphawave acquisition, custom silicon for hyperscalers, AI inference accelerators, and eventually Oryon-based server CPUs. In the data center, Qualcomm expects the sequence to begin with connectivity, move into custom silicon in early fiscal 2027, then AI accelerators in the second half of fiscal 2027, followed by Oryon server CPUs in fiscal 2028.

The strategic logic is built around a major shift in AI workloads. The first phase of the AI boom was dominated by training large models, where Nvidia’s GPUs and CUDA software stack remain the standard. But the next phase may be increasingly driven by inference, especially as agentic AI systems begin chaining together dozens of model calls to complete more complex tasks. That dramatically increases the number of inference requests and makes power efficiency, memory bandwidth and cost per token far more important.

This is where Qualcomm believes it has an opening.

The company’s most important technical announcement was High-Bandwidth Compute, or HBC. Rather than relying on the traditional model of pairing accelerators with stacks of high-bandwidth memory, Qualcomm is pursuing a “memory first” architecture that places compute more directly beneath the memory stack. The goal is to reduce the distance data has to travel, improve efficiency, lower power consumption and address one of the biggest bottlenecks in AI inference.

Just as important is the software announcement. Qualcomm’s acquisition of Modular may be the key to making the whole strategy work. Hardware adoption in AI is heavily dependent on the developer ecosystem, and Nvidia’s CUDA moat has made it difficult for competitors to gain meaningful share. Cristiano Amon has framed the Modular acquisition as a potential Android or Linux moment for AI infrastructure, where a more open, hardware-agnostic software layer could reduce dependence on any single vendor.

That is a powerful idea. Rather than asking customers to abandon Nvidia overnight, Qualcomm can offer a software platform that runs across Nvidia, AMD and Qualcomm silicon, while still creating a natural path toward its own accelerators over time. If it works, Modular gives Qualcomm a much more credible way to enter the AI infrastructure market than hardware alone.

The company also added customer validation to the roadmap. Microsoft is expected to deploy Qualcomm’s HBC technology in Azure, while Meta has committed to a multigenerational agreement for Qualcomm CPUs in its data centers. Qualcomm also reinforced the software story through a partnership with Hugging Face, giving developers a path to deploy open models across Qualcomm platforms.

Finally, Qualcomm’s connectivity expertise may be one of its most underappreciated advantages. AI data centers are increasingly constrained not only by compute and memory, but by the ability to move massive amounts of data across racks and clusters. Through Alphawave, Qualcomm now has high-speed connectivity assets that are already generating revenue, giving Dragonfly a current revenue stream while the broader AI platform develops.

Execution risk remains significant. Qualcomm is entering a crowded market with powerful incumbents, and several of the most important products will not reach commercial scale until fiscal 2027 or fiscal 2028. But the scope of the announcement is hard to dismiss. Qualcomm is not simply adding AI exposure. It is attempting to build a full data center platform around the economics of inference, where power efficiency, memory bandwidth, custom silicon, software openness and connectivity may become increasingly important competitive advantages.

Image Source: Qualcomm

Qualcomm’s Auto Execution ExtrapolatedFull disclosure, going into Qualcomm’s Investor Day, I had my doubts about the company’s foray into the AI data center buildout.

The technical capability was never really the question. Qualcomm has long been one of the most sophisticated chip designers in the world, with deep expertise in power efficiency, connectivity, system integration and edge computing. The bigger question was whether the company was simply too late. In a market already dominated by Nvidia, increasingly targeted by AMD and aggressively pursued by hyperscalers’ own internal silicon teams, it was fair to wonder whether Qualcomm could carve out a meaningful position.

But the more I look at the strategy, the more compelling it becomes.

Qualcomm is not making a single bet on one AI chip. It is taking a multi-pronged approach across connectivity, custom silicon, AI inference accelerators, server CPUs and software. That gives the company multiple ways to win. Some pieces of the portfolio may lag expectations, and that would not be surprising given the scale of the undertaking. But if even one or two segments meaningfully outperform, the overall opportunity could still become material.

I view the entire project almost as a strategic experiment. Qualcomm is putting several products into the market, testing where hyperscaler demand is strongest, and positioning itself around the areas where AI infrastructure is most likely to evolve next. Management may not describe it that way explicitly, but I think it is the right approach. The AI data center market is still young, and the economics are changing quickly. Rather than trying to predict the entire future with one product, Qualcomm is building a platform broad enough to adapt as the market develops.

That approach becomes more credible when viewed through the lens of Qualcomm’s recent success in automotive.

News from the automotive segment can get lost when management is announcing something as exciting as AI data center infrastructure, but the execution there may be the best model for what Qualcomm is trying to do now. The automotive business did not emerge overnight. Qualcomm entered through connectivity, expanded into the digital cockpit, and then moved deeper into advanced driver assistance and broader vehicle compute.

That layered strategy has worked. Automotive has quickly grown into one of Qualcomm’s most important non-handset businesses, crossing a $5 billion annualized revenue run rate in fiscal Q2 2026, with management expecting to exit fiscal 2026 above a $6 billion run rate. That is no longer a side project. It is becoming a real business line and a meaningful proof point for Qualcomm’s diversification strategy.

The parallel to AI infrastructure is important. In automotive, Qualcomm did not need to own the entire car to create value. It needed to identify the parts of the vehicle where compute, connectivity and software were becoming more important, then expand its content over time. In data centers, the same logic may apply. Qualcomm does not need to displace Nvidia across the full AI stack to succeed. It needs to find the areas where its advantages matter most.

That is why the inference-first focus is so important. Qualcomm is not trying to win yesterday’s AI infrastructure battle. It is trying to position itself for the next phase of the market, where power efficiency, memory bandwidth, connectivity and cost per token become more important as AI workloads scale from training into large-scale inference. Those are exactly the types of engineering problems Qualcomm has spent decades solving.

This does not eliminate execution risk. The data center market is larger, faster moving and more competitive than automotive. Nvidia’s ecosystem is entrenched, hyperscalers are increasingly building their own chips, and Qualcomm still has to prove that its roadmap can translate into commercial deployments at scale.

But automotive shows that Qualcomm can execute this type of transition. It can move beyond handsets, build a platform in an adjacent market, expand its content over time and convert long design cycles into meaningful revenue. That does not guarantee success in AI infrastructure, but it makes the plan far easier to take seriously.

For investors, that may be the key point. Qualcomm’s AI data center strategy should not be judged only as a late attempt to chase Nvidia. It should be viewed as the next test of the same diversification playbook that is already working in automotive. If the company can repeat even part of that success, the market may be underestimating how different Qualcomm’s business could look over the next several years.

Qualcomm Stock Breaks DownThe technical picture in QCOM stock offers a more tactical view of the setup.

Back in May, the stock rerated significantly higher after the company teased a major hyperscaler deal. From there, it built out a broad consolidation pattern, but since the full announcement, the stock has traded lower. Over the last week, QCOM broke below a key level of support, mirroring the broader weakness across the semiconductor sector.

Technical analysis does not provide reliable forecasting ability on its own, but it can show where large orders have left footprints. That is essentially what a “level” represents: an area where a meaningful amount of shares have changed hands and where buyers or sellers have previously shown up.

For now, QCOM remains below that breakdown level, and the near-term downtrend appears intact. That makes the stock more difficult for traders looking for a clean short-term entry. But at roughly 17x forward earnings, and with a potentially much larger long-term AI infrastructure opportunity beginning to take shape, the setup may be more attractive for investors looking for a bigger multi-year win rather than traders trying to capture the next short-term move.

The earnings revision picture may also supports a more patient view. Qualcomm currently has a Zacks Rank #3 (Hold), reflecting earnings estimates that have been relatively flat. That means analysts are not aggressively raising expectations yet, but they also are not cutting estimates in a meaningful way. In the context of a major strategic pivot, that leaves room for upside if management begins converting these announcements into visible revenue opportunities.

If revisions start to move higher, that could become an important bullish catalyst. A pickup in estimate momentum would signal that analysts are beginning to underwrite the AI data center opportunity more directly into their models, rather than treating it as a longer-dated optionality story.

Ultimately, the next major move in QCOM stock appears heavily tied to the broader semiconductor cycle. There may still be downside ahead over the next month if the group continues to unwind. But when the narrative pendulum finally bottoms and the market begins to lift the AI infrastructure theme again, Qualcomm could emerge with a much stronger story than it had in prior cycles.

The stock has broken down technically, but the business may be breaking out strategically.

Image Source: TradingView

Bottom Line on Qualcomm StockQualcomm’s AI data center strategy is still early, and execution risk remains high. The company is entering a crowded market, several key products are still years from scale, and the stock remains caught in the broader semiconductor pullback.

But the announcement changes the long-term story. Qualcomm is no longer just a mature mobile-chip company looking for incremental growth. It is attempting to build a broader AI infrastructure platform across inference, connectivity, custom silicon, software and power-efficient compute.

For now, the technical setup is weak and earnings revisions remain flat, which supports the Zacks Rank #3 (Hold). But that also leaves room for upside if analysts begin raising estimates as AI data center revenue becomes more visible.

In the near term, QCOM may still trade with the broader semiconductor group. Over the next several years, however, the bigger question is whether Qualcomm can turn this roadmap into a real second growth engine.

The stock is not without risk, but the setup is becoming much more interesting.

Many technology companies were off to the races when the AI boom first started, but Qualcomm (QCOM 2.39%) initially seemed slow to adapt.

Not anymore. The company has shifted its strategy toward artificial intelligence processors, applying its existing knowledge of edge computing to AI. It recently made a nearly $4 billion acquisition of an AI company to expand its reach for data center tech. No wonder its shares are up 66% over the past three months.

Better yet, Qualcomm's shares are still a great deal compared to the broader tech sector. Here's why it might be worth buying this AI stock right now.

Image source: Getty Images.

Qualcomm's big shift to AI Qualcomm has been busy expanding its AI footprint, and a few notable shifts make the company's AI angle intriguing.

Most recently, Qualcomm acquired the AI company Modular in an all-stock deal valued at about $4 billion. Modular makes software that can run any AI model across many different hardware platforms. It also has an AI coding language.

The purchase means Qualcomm expands its ability to benefit from growth in the AI data center infrastructure market through software. Adding the new programming language could help it compete with Nvidia (NVDA 0.86%) and its CUDA language.

Nvidia is a formidable opponent, of course, but Qualcomm is taking aim at the AI inference market, where Nvidia is vulnerable. Nvidia's graphics processing units (GPUs) have dominated the data center market for years, but tech companies are realizing that custom processors (which Qualcomm sells) can be better for AI inference and general tasks.

To help capture this market, Qualcomm just debuted its new Dragonfly C1000 CPU at its recent investor day, launching a powerful enterprise data center chip. The company is already inking deals with hyperscalers, with Meta announcing it has entered a multi-year agreement to use Qualcomm's processors in its data centers.

What's more, Qualcomm's management estimated that by fiscal 2029, the company will have more than $15 billion in AI infrastructure revenue. That's up from essentially nothing right now.

Finally, Qualcomm has been selling processors for everything from smartphones to cars for years. These chips are part of what's called edge computing, in which most processing is done on the device rather than in the cloud.

AI edge computing is likely to continue to expand as demand for advanced hardware increases. Consider that Apple, one of the world's largest hardware companies, touts on-device processing for its next-generation Siri AI software.

When considering its AI data center opportunities alongside its edge computing processors and other markets, Qualcomm's management recently said the company will have a $1.7 trillion total addressable market by 2030.

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It could be a smart move to own some Qualcomm stock There's no guarantee that all of Qualcomm's AI ambitions will pan out, of course. However, the company's stock is so inexpensive right now that it might be worth starting a new position in case things heat up for Qualcomm.

Its shares have a price-to-earnings ratio of just 21 right now, far below the tech sector average of 44. For a technology leader that's making smart moves into AI, that's quite a bargain.

Investors will need to keep a close eye on how well the company executes on its new chip deal with Meta and how much sales and earnings it actually brings in. They'll also want to keep watch to see how well Qualcomm uses its new Modular purchase to improve its expanding AI offerings.

Some of these things will take a little time to shake out, so investors should be patient as they wait to see how well Qualcomm executes on its plans. At such a low price, buying Qualcomm stock right now could allow investors to benefit from the company's big AI push.

The upbeat market backdrop comes as Counterpoint Research said Qualcomm is becoming one of the few semiconductor companies capable of delivering end-to-end AI infrastructure, spanning hyperscale data centers and edge devices.

AI Expansion Beyond Smartphones Gains CredibilityIn a research note published Friday following Qualcomm’s Investor Day, Counterpoint analyst Neil Shah said the chipmaker’s expanding AI portfolio and recent acquisitions position it as a credible full-stack AI solutions provider, with a path toward generating $100 billion in annual recurring revenue within the next five to seven years.

The analyst said Qualcomm’s diversification strategy extends well beyond smartphones and addresses the rapidly growing AI data center market, which remains in its early stages. The AI data center market is still in its infancy, and it is not a “zero-sum” game, Shah noted.

Acquisitions Build A Full AI StackCounterpoint highlighted Qualcomm’s recent acquisitions as key building blocks in its AI strategy.

The firm said NUVIA provides Qualcomm’s Oryon CPU architecture, enabling Arm-based processors that now span smartphones, PCs, automotive applications and future AI data centers.

Qualcomm also unveiled its C1000 server CPU, with Meta Platforms Inc. (NASDAQ:META) expected to become its first hyperscale deployment customer beginning around fiscal 2029.

The report also pointed to Qualcomm’s AI accelerator roadmap, custom silicon capabilities and its proprietary High Bandwidth Compute architecture, which aims to improve AI performance while reducing memory-related bottlenecks.

Counterpoint said the company’s recent acquisition of Modular strengthens its software stack by enabling AI workloads to run across different hardware platforms using an open architecture.

Data Center Opportunity Comes Into FocusCounterpoint said Qualcomm still faces gaps in networking and switching technologies, but noted that its acquisition of Alphawave Semi significantly expands its interconnect portfolio while bringing experienced leadership to its growing data center business.

The research firm also highlighted Qualcomm’s long-term financial targets unveiled during Investor Day. According to the report, management expects its AI data center business to generate about $15 billion in revenue by fiscal 2029, while the company’s non-handset businesses are projected to surpass handset revenue over the same period.

Automotive remains another major growth driver, with Qualcomm’s automotive design-win pipeline reaching $65 billion and expected to generate $10 billion in annual recurring revenue through fiscal 2029.

Counterpoint concluded that Qualcomm’s combination of silicon, software and ecosystem scale makes the company uniquely positioned to compete across the AI value chain, from hyperscale data centers to connected devices.

Technical Setup Remains MixedQualcomm continues to trade above its longer-term trend lines. The stock sits about 15.6% above its 100-day simple moving average of $166.92 and 14.9% above its 200-day simple moving average of $167.92.

However, the shares remain 11.3% below the 20-day simple moving average of $217.51 and 2.9% below the 50-day simple moving average of $198.72. That suggests the recent move is a rebound attempt rather than a confirmed recovery.

The 50-day moving average crossed above the 200-day moving average in May, forming a bullish “golden cross” that continues to support the intermediate-term trend. Even so, traders will likely look for the stock to reclaim the 50-day moving average before turning more bullish.

Momentum indicators remain cautious. The MACD remains below its signal line, indicating buying momentum has weakened following the previous rally.

Key technical levels to watch include resistance around $206, near the 50-day moving average, and support near $190.50, which aligns with a recent trading floor.

Earnings And Analyst OutlookQualcomm is expected to report quarterly earnings on or around July 29.

Wall Street expects earnings per share of $2.09 on revenue of $9.67 billion, compared with EPS of $2.77 and revenue of $10.37 billion in the year-ago quarter.

The stock trades at about 20.4 times earnings and carries a consensus Hold rating, with an average analyst price forecast of $209 based on coverage from 50 analysts. Recent analyst actions include:

Benchmark maintained Buy and raised its price forecast to $300 on June 25. Barclays maintained Underweight and increased its price forecast to $245 on June 25. UBS maintained Neutral and lifted its price forecast to $235 on June 25. Price ActionQCOM Stock Price Activity: Qualcomm shares were up 2.37% at $193.88 during premarket trading on Monday, according to Benzinga Pro data.

Photo via Shutterstock

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QUALCOMM Incorporated (QCOM) Analyst/Investor Day June 24, 2026 2:15 PM EDT

Company Participants

Cristiano Amon - CEO, President & Director
Antonios Pialis - Executive VP & General Manager of Data Center for Qualcomm Technologies, Inc.
Tim Davis - Co-Founder, President, Chief Product Officer & Secretary
Tony Pialis
Nakul Duggal - EVP, Group GM of Automotive, Industrial, Embedded IoT, & Robotics - Qualcomm Technologies
Brett Adcock - CEO, CFO, Secretary & Director
Chris Lattner - Co-Founder & CEO
Clément Delangue - Co-Founder, President, CEO & Director
Akash Palkhiwala - Executive VP, CFO & COO

Conference Call Participants

Brett Simpson - Arete Research Services LLP
Satya Nadella - Microsoft Corporation
Mark Zuckerberg - Meta Platforms, Inc.
Tareq Amin - Al-Mustaqbal Lil-Thaka Al-Istinai Company
David Reger - Neura Robotics GmbH
Panos Panay - Amazon.com, Inc.
Rick Osterloh
Christopher Caso - Wolfe Research, LLC
James Schneider - Goldman Sachs Group, Inc., Research Division
Joseph Cardoso - JPMorgan Chase & Co, Research Division

Presentation

Brett Simpson
Arete Research Services LLP

Good afternoon, everyone, and welcome to Qualcomm's 2026 Investor Day. It's great to be here in New York, and it's great to see so many familiar faces.

Now a lot of you have been asking me recently why I joined Qualcomm. And well, I think it's pretty clear. I think we have a really compelling investment case. And today is an opportunity to really share with you why we're so excited about what lies ahead for Qualcomm. We've got a lot to share with you today.

Before we jump into things, I just want to say a big thanks to everyone involved from Qualcomm and making this day possible. It's a huge amount of work. I really had no idea how much man hours goes into put an event like this on. And just wanted to say thanks to everyone. It's really amazing. And I also wanted to say a big thanks to all the executives from

Qualcomm has set out an ambitious growth target for its data centre business, forecasting $15 billion in sales from the segment by 2029 as it accelerates efforts to diversify beyond its core smartphone chip business.

At an investor presentation, Qualcomm Chief Financial Officer Akash Palkhiwala stated that the company anticipates its data centre business to generate $5 billion in revenue in fiscal 2027.

At the time of writing, Qualcomm shares were up around 12% in premarket trading.

QCOM also raised its outlook for revenue from chips outside its traditional smartphone business.

The company now expects this segment to bring in $40 billion by 2029, up from an earlier estimate of $22 billion.

“We will be truly diversified,” Palkhiwala said.

The upbeat outlook also lifted shares of Arm Holdings, which provides underlying technology for many Qualcomm chips.

Arm rose 5% after Qualcomm’s forecast.

Earlier in the day, Qualcomm said Microsoft and Meta Platforms will use its new AI chips.

The company also said it will make custom chips for two other unnamed hyperscalers.

The announcements mark a significant step in Qualcomm’s effort to establish itself in the fast-growing AI infrastructure market, where chipmakers are racing to secure a role in data centres and large-scale computing systems.

Qualcomm’s pivot towards AI chips comes as the smartphone market faces increasing pressure.

The company said the market has been squeezed by a memory chip shortage driven by surging demand for AI infrastructure.

At the same time, major customers such as Apple and Samsung are developing more chips in-house, adding to the pressure on Qualcomm’s traditional business.

Bank of America analysts had earlier estimated that Qualcomm’s data centre push could generate modest annual revenue of roughly $2 billion to $5 billion by fiscal 2027 to 2028.

Qualcomm’s new target points to a more aggressive expansion plan.

Alongside its revenue targets, Qualcomm announced that it has reached an agreement to acquire Modular Inc., in a move aimed at strengthening Qualcomm Technologies’ software capabilities for generative and agentic AI across both data centre and edge environments.

The company said the acquisition is designed to deepen the software foundation behind its data centre strategy, with a focus on improving inference, orchestration, and deployment in distributed AI systems.

Qualcomm said Modular provides an open, AI-native software stack that allows AI models to run efficiently across a range of hardware architectures, including CPU, GPU, NPU, and custom ASIC systems, without requiring developers to rewrite software for each accelerator.

According to Qualcomm, the acquisition will help connect system-level optimisation with increasingly heterogeneous and disaggregated computing environments, an area that is becoming more important as AI workloads scale and performance-per-watt becomes a critical factor in inference costs.

By combining Qualcomm Technologies’ chip capabilities with Modular’s software platform, the company said it aims to offer customers a more efficient AI compute layer spanning devices, edge systems, and cloud infrastructure.

“This acquisition marks a pivotal moment not just for Qualcomm, but for the AI industry,” said Cristiano Amon, President and CEO of Qualcomm Incorporated.

He said the industry is shifting towards “disaggregated, multi-vendor architectures” that require “a more open and modern software foundation.”

Modular Co-founder and CEO Chris Lattner said the deal would help advance the company’s mission of building a more open and efficient software foundation for AI.

“Joining Qualcomm gives us the scale and platform reach to accelerate that mission,” he said.

Qualcomm’s revenue targets and the Modular acquisition underline a broader strategic shift.

The company is positioning itself not only as a supplier of smartphone processors, but also as a provider of AI chips, custom silicon, and software infrastructure across data centre and edge computing markets.

The transaction is expected to close in the second half of 2026, subject to customary closing conditions and regulatory approvals.

NEW YORK--(BUSINESS WIRE)--Qualcomm Incorporated (NASDAQ: QCOM):

Highlights:

Raises its fiscal 2029 non-handset revenue target to $40 billion, approximately 2x the prior fiscal 2029 target. Unveils comprehensive data center AI infrastructure strategy with a revenue target of more than $15 billion by fiscal 2029. Expands automotive design-win pipeline to $65 billion and increases its growth target to $10 billion in revenues by fiscal 2029. Expands into robotics and industrial AI platforms as part of the next wave of Physical AI. Anticipates an agent-driven upgrade cycle across the edge in future years. Targets more than $18 non-GAAP EPS in fiscal 2029. Qualcomm Incorporated (NASDAQ: QCOM), a connected computing leader at the center of the AI era, today outlined the acceleration of its diversification strategy and unveiled its comprehensive strategy for the data center, marking its next phase of growth across every tier of the compute continuum, at its 2026 Investor Day.

“We are defining Qualcomm’s next chapter as we accelerate our edge diversification strategy, introduce a comprehensive roadmap for next-generation AI data centers, and evolve into a platform company,” said Cristiano Amon, President and CEO, Qualcomm Incorporated. “Our presence across the entire compute continuum and unparalleled technology capabilities, in low-power computing, AI and connectivity put us in a strong position to capture these opportunities.”

Updated fiscal 2029 targets for the QCT business include:

Non-handset revenues: $40 billion by fiscal 2029 Automotive revenues: $10 billion by fiscal 2029 IoT revenues: More than $14 billion by fiscal 2029 Industrial, networking and robotics: $8 billion Personal AI and Compute: $6 billion Data Center revenues: More than $15 billion by fiscal 2029 Handsets: To represent approximately one-third of QCT revenues by fiscal 2029 Multiple large markets are reaching inflection points, as AI compute becomes increasingly distributed across devices, edge and cloud over the next 3-5 years, including agent-ready edge devices, data center infrastructure, automotive, industrial systems, networking and robotics. Together, these represent a combined total addressable market of approximately $1.7 trillion by 2030.

Looking beyond fiscal 2029, Qualcomm sees continued secular growth across data center, robotics, ADAS and autonomous driving, industrial AI, personal AI and 6G, with agentic AI expected to drive a new upgrade cycle across intelligent connected devices. This next phase builds on accelerated diversification and proven operating leverage while funding new growth opportunities.

Qualcomm’s strategy was presented by Cristiano Amon along with Akash Palkhiwala, CFO and COO, Qualcomm Incorporated; Tony Pialis, EVP and GM, Data Center, Qualcomm Technologies, Inc.; and Nakul Duggal, EVP and Group GM, Automotive, Industrial and Embedded IoT, and Robotics, Qualcomm Technologies, Inc. Their full presentations and a replay of the event are available here.

About Qualcomm

Qualcomm is a global computing leader at the center of the AI era, enabling intelligence to scale from the most personal devices to large‑scale infrastructure. Building on more than four decades of innovation, we develop platforms and solutions that bring together advanced AI, high‑performance, low power computing and industry‑leading connectivity—powering products and services used around the world. At Qualcomm, we are engineering human progress.

Qualcomm Incorporated includes our licensing business, QTL, and the vast majority of our patent portfolio. Qualcomm Technologies, Inc., a subsidiary of Qualcomm Incorporated, operates, along with its subsidiaries, substantially all of our engineering and research and development functions and substantially all of our products and services businesses, including our QCT semiconductor business. Snapdragon and Qualcomm branded products are products of Qualcomm Technologies, Inc. and/or its subsidiaries. Qualcomm patents are licensed by Qualcomm Incorporated. Qualcomm, Snapdragon, Qualcomm Dragonwing and Qualcomm Dragonfly are trademarks or registered trademarks of Qualcomm Incorporated.

Note Regarding Forward-Looking Statements

This press release includes forward-looking statements that are inherently subject to risks and uncertainties, including but not limited to statements regarding: our growth and diversification initiatives and opportunities, including in automotive, the internet of things (IoT) and data center; technology trends, including the continued evolution and adoption of AI technologies, the opportunities this creates for our business and the potential benefits to our business thereof; our technologies, technology leadership, technology differentiation and technology roadmap; our business and share trends, as well as market and industry trends, and their potential impact on our business and our positioning to take advantage thereof; anticipated product renewal and device upgrade cycles; market inflection points; our design wins and design-win pipeline; our total addressable market expansion; our business outlook; and our estimates, guidance, targets and planning assumptions related to financial performance, including our various targets for revenues, revenue composition and earnings per share (EPS). Words such as “estimate,” “guidance,” “forecast,” “target,” “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “may,” “will,” “would” and similar expressions or variations of such words are intended to identify forward-looking statements, but are not the exclusive means of identifying forward-looking statements in this release. Actual results may differ materially from those referred to in the forward-looking statements due to a number of important factors, including but not limited to: our dependence on a small number of customers and licensees, and particularly from their sale of premium-tier handset devices; our customers vertically integrating; a significant portion of our business being concentrated in China, which is exacerbated by U.S./China trade and national security tensions; our ability to extend our technologies and products into new and expanded product areas, and industries and applications beyond mobile handsets; our strategic acquisitions, transactions and investments, and our ability to consummate strategic acquisitions; our dependence on a limited number of third-party suppliers; risks associated with the operation and control of our manufacturing facilities; security breaches of our information technology systems, or other misappropriation of our technology, intellectual property or other proprietary or confidential information; our ability to attract and retain qualified employees; the continued and future success of our licensing programs, which requires us to continue to evolve our patent portfolio and to renew or renegotiate license agreements that are expiring; efforts by some OEMs to avoid paying fair and reasonable royalties for the use of our intellectual property, and other attacks on our licensing business model; potential changes in our patent licensing practices, whether due to governmental investigations, legal challenges or otherwise; adverse rulings in governmental investigations or proceedings or other legal proceedings; our customers’ and licensees’ sales of products and services based on cellular and other communications technologies, including 5G, and our customers’ demand for our products based on these technologies; competition in an environment of rapid technological change, and our ability to adapt to such change and compete effectively; failures in our products or in the products of our customers or licensees, including those resulting from security vulnerabilities, defects or errors; difficulties in enforcing and protecting our intellectual property rights; claims by third parties that we infringe their intellectual property; our use of open source software; the cyclical nature of the semiconductor industry, declines in global, regional or local economic conditions, or our stock price and earnings volatility; geopolitical conflicts, natural disasters, pandemics and other health crises, and other factors outside of our control; our ability to comply with laws, regulations, policies and standards; our indebtedness; and potential tax liabilities. These and other risks are set forth in our Quarterly Report on Form 10-Q for the fiscal quarter ended March 29, 2026 filed with the Securities and Exchange Commission (SEC). Our reports filed with the SEC are available on our website at www.qualcomm.com. We undertake no obligation to update, or continue to provide information with respect to, any forward-looking statement or risk factor, whether as a result of new information, future events or otherwise.

Note Regarding Use of Non-GAAP Financial Measures

The Non-GAAP financial measures presented herein should be considered in addition to, not as a substitute for or superior to, financial measures calculated in accordance with GAAP. In addition, “Non-GAAP” is not a term defined by GAAP, and as a result, our Non-GAAP financial measures might be different than similarly titled measures used by other companies. Reconciliations between GAAP and Non-GAAP financial measures are presented below.

FY29 Earnings Per Share (EPS)
Target1

GAAP diluted EPS

>$14.50

Less QSI

N/P

Less share-based compensation

N/P

Less other items

N/P

Non-GAAP diluted EPS

>$18.00

1. Guidance as of June 24, 2026. Substantially all of the amounts excluded from our FY29 Non-GAAP EPS target relate to share-based compensation.

Qualcomm on Wednesday revealed a central processing unit for data centers called Dragonfly C1000, and said that Meta would use it when it starts production in 2028.

The chipmaker said that the new data center CPU was built for agentic AI and focuses on offering computing performance without using too much power.

The announcement, made at a Qualcomm presentation to investors, is another sign that the chipmaker best known for smartphone processors and modems is aggressively targeting the data center market.

On Wednesday, Qualcomm said that it has a roadmap to target the quickly-growing market with several different products, including an AI chip and a product that will tie multiple chips together.

"We just been executing, collecting assets, and when we got to this point, we feel that we have a comprehensive portfolio to enter the next phase of the data center," Qualcomm CEO Cristiano Amon said at the investor day.

Shares of the chipmaker were down in trading on Wednesday.

Qualcomm CFO Akash Palkhiwala said in an interview that Qualcomm already has business with nearly every hyperscaler through its smartphone chips and other existing products.

"This is not a new relationship. It's the benefit of what we've delivered to them already on the edge, combined with the scale and the expertise and the confidence in Qualcomm, is what makes them engage with us on data center," Palkhiwala said.

Read more CNBC tech newsAmazon's Zoox unveils redesigned robotaxi ahead of upcoming expansionOpenAI unveils first chip as part of Broadcom deal in effort to 'build the full stack'South Korean chipmaker SK Hynix plans to raise $29 billion via Nasdaq listing as soon as July 10Alphabet added to Dow Jones Industrial Average, replacing VerizonIt also comes as investor interest in CPUs is rising, as experts believe that central processors will take on more of the workload from graphics processing units and AI chips because of AI agents, which run autonomously.

"There really isn't enough supply, and multiple players are needed," in the CPU market, Palkhiwala said

Qualcomm's primary business in recent years has been smartphones, which accounted for two-thirds of the company's product revenues in the quarter ended in March.

But the company is seeking to diversify into cars, robots, and now, the data center, which are faster-growing markets for chips than the smartphone sector, which peaked in terms of shipments in 2017, according to estimates.

The chipmaker says that its expertise at making smartphone and PC chips that conserve battery life will serve customers like hyperscalers which are increasingly building data centers where the limiting factor is electrical power.

The company said that it had secured two deals to make custom silicon chips for hyperscalers.

Separately, Qualcomm announced that it had acquired Modular for an undisclosed price. The startup made software that enables AI applications to run on a broad range of chip architectures, and Qualcomm says that it is an equivalent to Nvidia's CUDA, which is used in many AI applications.

Amon told investors that the company was not entering the data center market too late.

"When people ask about if it's late to enter the data center, you should think about scale and execution, or engineering capabilities, or operations and supply chain," Amon said.

watch now

Qualcomm Inc. QCOM shares moved lower on Tuesday, falling about 6% in trading as a broader technology selloff weighed on sentiment, even as fresh reports pointed to an expansion of its artificial intelligence ambitions.

The decline came despite Bloomberg reporting that Qualcomm is in advanced talks to acquire AI infrastructure software company Modular Inc. in a deal valued at around $4 billion.

A transaction could be announced in the coming weeks, though sources emphasized that a final agreement is not guaranteed and terms could still change.

Qualcomm stock has been one of the stronger performers in the semiconductor space in recent months, rising 72% over the past three months and gaining around 30% year to date.

Investors have been positioning ahead of the company’s investor day on Wednesday, where Qualcomm is expected to provide updates on its next-generation processor strategy and potentially identify a major customer for a custom data-center chip.

Modular Inc., founded in 2022 in Silicon Valley by Chris Lattner and Tim Davis, former Google employees, focuses on building software tools designed to simplify the deployment of artificial intelligence models across different hardware systems and cloud environments.

According to its website, the founders created the company after becoming “frustrated by AI’s fragmented infrastructure.”

The startup has positioned itself in a growing segment of the AI market focused on inferencing and cross-platform deployment, an area increasingly seen as critical as AI workloads expand beyond training into real-world applications.

Modular raised $250 million in a September funding round at a $1.6 billion valuation, bringing total capital raised to $380 million.

The reported acquisition price of roughly $4 billion would represent more than a 2.5-times increase in valuation in less than two years.

The company is backed by investors including DFJ Growth, Factory, General Catalyst, Google Ventures, Greylock Partners and US Innovative Technology Fund.

The Modular discussions are part of a wider acquisition strategy aimed at strengthening Qualcomm’s position in artificial intelligence.

The Information in a seperate report said that the company is in talks to acquire AI chip startup Tenstorrent for between $8 billion and $10 billion.

If completed, the two deals would reflect a dual-track AI expansion strategy: hardware capabilities through Tenstorrent and software infrastructure through Modular.

Qualcomm has previously pursued similar expansion efforts through acquisitions, including its agreement to buy Alphawave IP Group Plc for about $2.4 billion in cash.

Its earlier attempt to acquire NXP Semiconductors NV was ultimately scrapped due to regulatory hurdles.

The company is expected to use its upcoming investor day to provide further details on its AI roadmap, including custom chip development and potential major customer relationships.

Despite the acquisition momentum, Qualcomm shares remain under pressure in the near term amid a broader tech sector downturn.