Qualcomm shifts focus to automotive and data center growth, projecting non-handset revenue to double by 2029 while maintaining strong capital returns and a 6.66% free cash flow yield.
Qualcomm is transitioning from a handset-dependent supplier to a diversified chipmaker with strong automotive, IoT, and data center growth, supported by aggressive capital returns.
Amazon is collaborating with Qualcomm on a multi-generational data center deal, signaling expansion in hyperscaler custom silicon.
Apple is vertically integrating away from Qualcomm modems, reducing its reliance on Qualcomm's QCT business.
Meta is mentioned as part of the AI buildout catalyst, but no specific partnership details provided.
Qualcomm is aggressively pivoting away from smartphone dependency, targeting $40 billion in non-handset revenue by fiscal 2029. With automotive revenue surging 61% year-over-year and new data center partnerships with Amazon, the company is offsetting the loss of Apple modem business through high-growth industrial and hyperscaler segments.
Qualcomm is actively replacing Apple's contribution by growing its non-handset business, specifically in automotive, IoT, and data center sectors, with projections to fully offset Apple's revenue impact by fiscal 2027.
The strategy is driven by a transition into a diversified chipmaker, focusing on automotive agreements with BMW and Stellantis, and hyperscaler custom-silicon engagements, including a multi-generational deal with Amazon.