Qualcomm Inc (NASDAQ:QCOM) stock slid on Friday as a broader semiconductor sell-off weighed on the stock, following negative reaction to Broadcom Inc (NASDAQ:AVGO) guidance.
JPMorgan analyst Samik Chatterjee kept Qualcomm at Neutral but raised his price forecast to $265 from $160, saying the company could use its June 24 Investor Day to outline a bigger diversification story led by data centers, automotive and IoT.
• Qualcomm shares are retreating from recent levels. Why are QCOM shares down?
Data Center Could Become Qualcomm’s Next Major Growth Engine
Chatterjee expects Qualcomm to present a three-pillar data center strategy built around custom silicon, merchant CPUs and AI accelerators, including off-the-shelf merchant products and custom connectivity from Alphawave. He expects Qualcomm to target more than $3 billion in data center revenue in fiscal 2027 and $35 billion by fiscal 2031.
The analyst said Qualcomm can enter a large opportunity as AI workloads expand demand for CPUs, custom ASICs and accelerators. He expects the company’s data center ramp to begin with custom ASICs for hyperscaler customers, followed by accelerator revenue from Humain and, later, CPU revenue tied to agentic AI workloads.
Automotive and IoT Add to Diversification
Chatterjee expects Qualcomm to target about $17 billion in automotive revenue by fiscal 2031, supported by continued growth in connectivity, infotainment, ADAS, and autonomous-driving solutions. He said the company’s driving stack, co-developed with BMW for the Neue Klasse platform, is now available for other automakers and Tier 1 suppliers.
He also expects Qualcomm’s IoT revenue to reach about $17 billion by fiscal 2031, driven by PCs, refreshed Snapdragon platforms, robotics, industrial AI, and personal AI devices such as glasses, pendants, and rings.
Non-Handset Revenue Could Reach 70% Of Total Sales
Chatterjee expects Qualcomm’s non-handset QCT revenue to grow at a more than 40% CAGR from fiscal 2026 to fiscal 2031. He estimates non-handset revenue could rise from about $13 billion in fiscal 2026 to about $69 billion by fiscal 2031.
The analyst expects non-handset markets to contribute 73% of QCT revenue and 69% of total revenue by fiscal 2031, with data centers accounting for about 35% of total revenue. He also raised his fiscal 2027 EPS estimate to $11.50 from $10.45 after adding about $3 billion of data center revenue to his model, while using a 23-times multiple on fiscal 2027 EPS to reach his $265 price forecast.
QCOM Price Action: Qualcomm shares were down 8.78% at $221.23 at the time of publication on Friday, according to Benzinga Pro data.
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