Qualcomm said it expects data center revenue of roughly $5 billion in fiscal 2027, with a longer-term target of $15 billion by fiscal 2029, ahead of the Goldman Sachs Communacopia + Technology Conference on Tuesday, September 8, 2026.
The figures were underscored by a warrant agreement with Amazon that ties up to $60 billion in data center product purchases over 10 years, with approximately 15% of the warrants vesting upfront. Revenue under the arrangement is set to begin in the December quarter. The Amazon deal covers customized silicon across multiple generations and optical connectivity solutions starting with 1.6T products and subsequent generations.
Qualcomm laid out four data center technology pillars: custom silicon collaborations with Amazon and another undisclosed global hyperscaler; High Bandwidth Compute (HBC) technology targeting memory bandwidth constraints in inference decode workloads; Arm-based CPU solutions, with Meta named as the first data center CPU customer; and connectivity through Alphawave SerDes integration and optical products. Management indicated that Humane AI accelerator deployments and additional Meta CPU engagement are expected around fiscal 2028 to 2029.
The company also pulled forward its automotive revenue target to $10 billion, moving it up from a previously stated 2031 timeframe, saying the segment is expected to become the largest chip business in the industry next year. Qualcomm aims to reach a 30% operating margin within three years.
In smartphones, Qualcomm reported volume declines of low double-digit to low-teens over the past year. The sub-$300 segment faces particular pressure, with memory costs now exceeding 50% of the bill of materials, though premium phone demand remains resilient. To address gaps in its software stack, Qualcomm acquired Modular, aiming to make lower-layer software open and portable across platforms including Nvidia, AMD, Qualcomm, AWS, and Apple.
At the time of the conference, Qualcomm's market capitalization stood at $187.3 billion, with a P/E ratio of 20.4. Over the trailing twelve months, the company posted a 54% gross profit margin and 34% return on equity, with a dividend yield of 2.2%. Management noted it has raised its dividend for 23 consecutive years. CFO and COO Akash Palkhiwala described the company as "a well-priced, highly diversified, and growing stock," adding that its low-power approach is particularly relevant in data centers.
