Guidance gives bulls a bigger TAM to price in, but execution risk remains high. Custom hyperscaler wins and Meta CPU design validate the roadmap, yet consensus already bakes in aggressive data center scaling. Watch for $5B FY27 milestone and Apple licensing renewal clarity.
Key Numbers
What happened
Qualcomm raised its fiscal 2029 non-handset revenue target to $40 billion from a previous $22 billion goal, driven by expanded data center ambitions. The updated forecast includes more than $15 billion in data center revenue, over $10 billion from automotive, and more than $14 billion from IoT businesses. Management also projected fiscal 2029 adjusted earnings per share above $18, compared with Wall Street expectations of roughly $14 to $15.
The data center roadmap now spans custom silicon, connectivity products, high-bandwidth compute accelerators, and AI-focused CPUs. Qualcomm expects about $5 billion in fiscal 2027 data center revenue, supported by two custom hyperscaler design wins, connectivity products, and shipments of its AI200 accelerator in the second half of fiscal 2027. Management disclosed that Meta Platforms will be a customer for its CPU products, with ramps expected in the second half of 2028. Two hyperscale customers are expected to exceed $1 billion each in fiscal 2027.
Beyond data centers, Qualcomm raised its fiscal 2029 automotive revenue target to more than $10 billion from about $8 billion and expanded its automotive design-win pipeline to approximately $65 billion from $45 billion around 18 months ago. The company maintained its IoT revenue target of more than $14 billion. Management also indicated a longer-term goal of more than $100 billion in annual revenue over the next five to seven years.
What to watch
Fiscal 2027 data center revenue milestone of $5 billion - critical proof point for custom ASIC ramps and AI200 accelerator traction
Second half of fiscal 2027: AI200 accelerator shipments begin
Second half of fiscal 2028: Meta CPU product ramp expected
Apple licensing agreement renewal - uncertainty around future terms poses material risk to EPS trajectory
China-linked custom chip revenue exposure - geopolitical and supply chain risks flagged by analysts
Also Worth Watching
Named as a CPU customer with ramps starting second half of fiscal 2028. Meta's adoption validates Qualcomm's data center credibility beyond custom ASICs, particularly given Meta's existing use of Nvidia, Arm-based, and x86-based infrastructure. If Qualcomm captures even modest share of Meta's AI buildout, it accelerates the $15B data center target and pressures incumbent suppliers. META (Meta Platforms Inc $564.05 (+0.3%) - )
Company Overview
Qualcomm designs and licenses wireless communications technology, primarily for smartphones, and manufactures application processors and modems. The company generates revenue from chip sales and licensing its intellectual property to device manufacturers worldwide.
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