Qualcomm Targets AI Data Centers as Apple Orders Shrink Faster

Qualcomm has long supplied modem chips for Apple’s iPhones, but that business was expected to contract as Apple shifts toward internally designed modems. A faster retreat would put added pressure on one of Qualcomm’s key handset revenue streams, sharpening the need to diversify beyond smartphones. The chipmaker is increasingly looking to AI data centers and other non-handset markets to reduce its exposure to a major customer and the mature mobile-device market.

Qualcomm said supply constraints would cause revenue from Apple modem chips to decline faster than previously anticipated, widening the gap it must offset. The company is positioning AI data centers as a major new growth engine and expects the business to generate $5 billion in revenue in 2027. That target underscores Qualcomm’s effort to replace shrinking Apple orders with demand for computing infrastructure used to develop and run artificial intelligence services.