Qualcomm (QCOM) plans to build custom CPUs (central processing units) for data centers using Nvidia (NVDA) tech to connect faster with Nvidia’s AI chips. This move marks Qualcomm’s re-entry into the data center CPU market.
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Qualcomm Teams Up with Nvidia
In the 2010s, Qualcomm began work on an ARM (ARM)-based CPU, but the project was paused due to budget cuts and legal problems. Now, Qualcomm is back in the race to make data center chips. Currently, Intel (INTC) and AMD (AMD) lead the market by providing CPUs that pair with AI chips. Nvidia has also started making its CPUs, using ARM tech to build a chip named Grace.
Now, Qualcomm plans to make CPUs that connect well with Nvidia’s GPUs, helping data centers run faster. Notably, Qualcomm CEO Cristiano Amon said the partnership aims to boost fast and energy-saving data center computing. Together, Qualcomm and Nvidia could shake up the data center market, challenge the current leaders, and draw more interest from investors.
Last week, Qualcomm also signed a deal with Saudi Arabia’s Humain to build advanced AI data centers in the region. The partnership was announced during President Trump’s visit to Saudi Arabia, where he secured $600 billion in business deals.
Is QCOM a Good Stock to Buy Now?
According to TipRanks, QCOM stock has a Moderate Buy consensus rating based on eight Buys, eight Holds, and one Sell assigned in the last three months. At $178.31, the Qualcomm stock price target implies a 17% upside potential.
