Qualcomm Announces New AI Chips in Data Center Push, Shares Surge

Wedoany.com Report-Oct. 28, Qualcomm (QCOM.O) announced on Monday the launch of two new artificial intelligence chips designed for data centers, signaling a major step in its diversification strategy beyond the slowing smartphone market. The news drove Qualcomm’s shares up 20%, reflecting strong investor confidence in its AI-focused expansion.

The two chips, named AI200 and AI250, are engineered to deliver enhanced memory capacity and efficiency in running AI applications, also known as inference. According to Qualcomm, the AI200 will be commercially available in 2026, followed by the AI250 in 2027. The company emphasized that both chips will support widely used AI frameworks and tools, enabling cost-effective deployment of AI workloads in enterprise and cloud environments.

The global race to develop advanced AI chips has intensified as technology firms, cloud service providers, and enterprises seek to build infrastructure capable of powering large language models, chatbots, and other generative AI applications. Qualcomm’s entry into the data center chip segment marks its direct competition with established players such as Nvidia (NVDA.O) and AMD (AMD.O), which have recently expanded from selling chips to providing full-scale data center systems.

Despite the growing competition, Nvidia remains dominant due to its powerful processors and the high switching costs associated with changing chip suppliers. However, Qualcomm aims to differentiate itself through its energy-efficient architecture and scalability for decentralized computing environments.

Joe Tigay, portfolio manager of the Rational Equity Armor Fund, commented: “Qualcomm's entry and major deal in Saudi Arabia prove the ecosystem is fragmenting because no single company can meet the global, decentralized need for high-efficiency AI compute.” His remarks highlight Qualcomm’s growing global reach and its role in meeting increasing demand for sustainable AI infrastructure.

Qualcomm, the world’s largest supplier of modem chips for smartphones, has been actively diversifying its business to reduce dependence on the mobile sector. The smartphone market has faced slower growth, particularly after the company lost Huawei (HWT.UL) as a major customer and as Apple (AAPL.O) continues developing its own chips.

Over the past two years, Qualcomm has expanded into the personal computer market, introducing processors that compete with Intel (INTC.O) and AMD in powering Windows-based laptops. The company’s growing portfolio of AI and computing products reflects its strategy to establish a stronger presence across multiple technology segments.

By developing data center AI chips alongside its continued investments in mobile and PC processors, Qualcomm aims to position itself as a key player in the global AI infrastructure market. The launch of the AI200 and AI250 chips represents a significant milestone in this transition, underscoring the company’s broader vision of becoming a leader in intelligent computing beyond smartphones.