Qualcomm is Planning a Comeback to the Server Market With New Chip
According to people familiar with its strategy, Qualcomm is thinking of entering the server market with a new chip in an effort to lessen its dependency on smartphones, Bloomberg News reported on Thursday.
The price of Qualcomm stock increased by almost 3% in afternoon trading.
According to the article, the chipmaker is looking for clients for a product resulting from its acquisition of Nuvia. It also stated that Amazon.com’s cloud business, Amazon Web Services (AWS), has agreed to look into Qualcomm’s products.
With intentions to incorporate the company’s technology into its smartphone, laptop, and car processors, the chipmaker purchased Nuvia last year, a chip startup formed by former Apple employees.
In contrast, Qualcomm said it does not comment on rumors and pointed Reuters to its press statement from when it finalized the Nuvia transaction in March of last year. Amazon said that it had agreed to look into the proposition.
the San Diego area In July, Qualcomm issued a fourth-quarter revenue projection that fell short of Wall Street expectations as it prepared for a challenging economic climate and a downturn in smartphone demand that might harm its primary mobile chip business.
Akash Palkhiwala, chief financial officer, stated at the time of the earnings that “we think the rising volatility in the global economy and the impact of COVID measures in China will force customers to act with care in controlling their purchases in the second half.”
In addition to worsening supply-chain issues and hurting demand, the Ukraine conflict and China’s lockdowns forced many phone manufacturers to reduce their orders for chips.
Instead of flat growth, the business now projects a 5% decline in smartphone sales for this year. IDC had predicted a decrease in smartphone shipment volume of 3.5%.
The handset industry, which produces modem chips for Apple iPhones and some models of Samsung’s Galaxy S series, accounts for more than half of Qualcomm’s overall sales.
Executives from the company reaffirmed that Qualcomm’s efforts to diversify into other markets, such as the automotive industry, as well as its focus on providing chips for high-end smartphones will mitigate the impact of slowing smartphone demand.
