Qualcomm Eyes $15B AI Data Center Revenue, 18.5% Earnings Growth
QCOM•Qualcomm projects data center revenue to reach $15 billion by fiscal 2029 through multi-generation AI inference chip agreements, including a key deal with Meta, and forecasts 18.5% annual earnings growth. However, shares declined 2.1% in the latest session, underperforming the S&P 500’s 0.8% gain.
1. AI Inference Strategy
Qualcomm has refocused its chip design toward AI inference workloads, aiming to capture a growing share of data center compute. The company’s inference-optimized processors are positioned as cost-effective alternatives to incumbent offerings, backed by multi-generation supply agreements.
2. Data Center Revenue Outlook
Management forecasts data center revenue will climb to $15 billion by fiscal 2029, driven by binding customer pacts. A flagship multi-year deal with Meta anchors this projection, with commitments spanning several chip generations.
3. Earnings Growth and Valuation
Analysts expect Qualcomm’s earnings to grow at an 18.5% CAGR through fiscal 2029, reflecting robust AI demand and margin expansion. Shares trade at roughly 17x forward earnings, with a consensus price target near $473 implying 150% upside.
4. Recent Stock Performance
In the latest trading session, Qualcomm’s shares slipped 2.1%, lagging the S&P 500’s 0.8% gain. The pullback follows mixed sentiment over the timeline for large-scale data center AI deployments.
