This Week Is Key for Qualcomm's Place in the AI Data Center Chip Space

Later this week, Qualcomm (QCOM) will report its latest quarter and update us on the progress it is making with its revenue diversification program.

For those less familiar with this initiative, Qualcomm is purposely leaning into the AI-PC, IoT and automotive chip markets to reduce its reliance and the smartphone market and Apple (AAPL) . To those efforts, we can add Qualcomm’s recent announcement that, through its AlphaWave acquisition, the data center market will become a larger focus as well. Helping support that move, Saudi artificial intelligence company Humain said it would use Qualcomm's AI accelerators as it targets 200 megawatts starting in 2026.

A nice early win, but we’ll need to see more for Qualcomm to be considered a real contender in the AI data center chip space. Based on the company’s ability to manage power constraints in the mobile, PC and IoT markets with performance, we’re not ones to rule it out quite yet.

We look forward to that update, given reports by Bloomberg that, with its iPhone 18, Apple could remove Qualcomm modems in favor of its AI silicon components. This has been an expected move by Apple, and the company took its first step in doing so with the iPhone Air. Comparisons between Apple’s modem and Qualcomm’s find that Qualcomm modems generally offer better performance, especially in challenging network conditions, while Apple's modem excels in power efficiency and battery life.

While we should expect both companies to make further improvements to their offerings, the question we’re pondering is whether Apple will make a gradual move with its internal modems to the iPhone 18 and keep its Pro lineup with Qualcomm, or make an across-the-board change in one fell swoop.

We may get some clues on that on Wednesday afternoon. When we get them, we should remember Qualcomm’s strong position in the Android smartphone ecosystem, especially with premium and flagship models. Those are markets the company will continue to pursue.

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At the time of publication, TheStreet Pro Portfolio was long QCOM and AAPL.