Qualcomm announced during its fourth-quarter fiscal 2026 earnings call on November 4, 2026, that it anticipates its data center segment will be a primary growth driver, targeting $15 billion in annual revenue by fiscal year 2029. This strategic shift comes as the global smartphone market experienced a 20% decline in shipments during the September quarter, reaching a 14-year low. Qualcomm's handset unit revenue fell 26% to $5.14 billion in the fourth quarter.
For the first fiscal quarter of 2027, Qualcomm projects data center revenue to exceed $650 million, with a full-year target of $5 billion for fiscal 2027. The company expects this segment to reach an annualized run rate of $7 billion by the end of fiscal year 2027. Qualcomm’s total non-GAAP revenues for fiscal Q4 2026 were $10.4 billion, with non-GAAP earnings per share at $2.17.
The company has been laying the groundwork for its data center expansion through partnerships with major technology firms. In September 2026, Qualcomm announced a multi-generational collaboration with Amazon to develop customized silicon for large-scale AI data centers, focusing on AI inference and optical connectivity solutions. This agreement could involve Amazon purchasing up to $60 billion of Qualcomm's AI chips and related products over time. Qualcomm also established a strategic multi-generation agreement with Meta in June 2026 to supply data center CPUs, with Qualcomm's Dragonfly C1000 CPU expected to be in production in the second half of 2028.
Qualcomm plans to disclose its data center segment as a separate revenue line within its QCT business unit starting in fiscal year 2027, alongside mobile, automotive, and IoT. The company's non-handset revenues, which include automotive and IoT, grew 36% year-over-year in fiscal Q4 2026. Qualcomm's automotive revenue reached its first $2 billion quarter, an 89% year-over-year increase. The company has also raised its fiscal 2029 non-handset revenue target to $40 billion, which includes the $15 billion from data centers, $10 billion from automotive, and over $14 billion from IoT.
The company's guidance for the first fiscal quarter of 2027 projects total revenues between $10.4 billion and $11.2 billion, with non-GAAP EPS between $2.15 and $2.35. Qualcomm's QCT segment is expected to generate revenues of $9 billion to $9.6 billion, with the data center segment contributing to this figure.