Smartphone Sales Slump — Qualcomm Bets on $5 Billion from Data Centers
Qualcomm's revenue from smartphone chips dropped by 26% in the quarter. The company is expanding its business beyond phones and confirmed its target to generate $5 billion in revenue from the data center segment in the 2027 fiscal year.
Qualcomm concluded the fourth quarter of the 2026 fiscal year with adjusted revenue of $10.44 billion, a 7% decrease compared to the previous year. Adjusted net profit fell by 28%, to $2.33 billion.
The main smartphone segment generated $5.14 billion in revenue, down from $6.96 billion the previous year. Meanwhile, the automotive business grew by 89%, reaching nearly $2 billion, and the Internet of Things segment increased by 4%, to $1.89 billion.
Qualcomm's next growth phase is tied, among other things, to AI infrastructure. The company announced a multi-generational collaboration with Amazon in the field of AI data centers. Qualcomm CEO Cristiano Amon confirmed the target for the server segment: $5 billion in revenue in the 2027 fiscal year. This is a forecast, not an already achieved result.
The company also warned of rising costs for production, chip packaging, memory, and other materials. Qualcomm reflects these expenses in its product pricing but expects the full impact on profitability only in the second half of the 2027 fiscal year.
