Qualcomm Shifts Growth Bet to AI Data Centers as Smartphone Sales Fall

What changed

Qualcomm is shifting its growth bet from smartphones to AI data centers as smartphone sales fall about 20% from 2025. After discussing partnerships with Amazon and Meta earlier in 2026, the company forecast data-center revenue of about $650 million in the first quarter of 2027, rising to $5 billion by the end of 2027 and $15 billion by 2029.

Why it matters

This is a sharp change in what Qualcomm needs to prove. Its smartphone business is weakening, while its new data-center business must grow from hundreds of millions of dollars into a multibillion-dollar operation in roughly two years.

The forecast is ambitious. Qualcomm has named major partners, but the scale and timing of their commercial deployments remain uncertain. If those partnerships turn into substantial business, data centers could become a central engine for Qualcomm’s finances. If they do not, the company will have made a large strategic promise while its older market is already shrinking.