Qualcomm Considers Re-Entry into Server Market with New Chip

According to a report from Bloomberg News, Qualcomm Inc is considering a return to the server market with a new chip, signaling its intention to reduce its reliance on smartphones. The chipmaker is seeking customers for a product stemming from its acquisition of Nuvia Inc, a chip startup founded by Apple Inc veterans, which it purchased last year. The company plans to integrate Nuvia’s technology into its smartphone, laptop, and automotive processors.

The report also revealed that Amazon Web Services (AWS), the cloud computing subsidiary of Amazon.com Inc, has agreed to take a look at Qualcomm’s offerings. However, neither company has confirmed the partnership.

The potential move to re-enter the server market is a significant one for Qualcomm, which exited the market in 2018 after failing to compete with Intel and AMD. Re-entering this market could be a strategic move, as it would allow the chipmaker to diversify its business and reduce its reliance on the smartphone market.

This comes after Qualcomm forecasted fourth-quarter revenue below Wall Street targets last July, preparing for a difficult economy and a slowdown in smartphone demand that could hurt its mainstay handset chip business.

If Qualcomm is successful in its return to the server market, it could benefit from the growing demand for cloud services and data centers. The COVID-19 pandemic has accelerated the shift towards remote working, which has led to an increase in demand for cloud computing and data storage.

In addition, Qualcomm’s return to the server market could also benefit from the growing trend of edge computing. Edge computing refers to the processing of data closer to the source rather than in a centralized location, which reduces latency and improves efficiency. This trend is gaining momentum, as businesses are looking for faster and more efficient ways to process data.

Qualcomm’s potential move into the server market could also challenge Intel and AMD, who currently dominate the market. However, it remains to be seen whether Qualcomm’s new chip can compete with the established players in terms of performance and efficiency.

In conclusion, Qualcomm’s potential return to the server market is a significant move for the company as it looks to diversify its business and reduce its reliance on smartphones. The growing demand for cloud services and data centers, as well as the trend of edge computing, could provide opportunities for Qualcomm in the server market. However, it remains to be seen whether the chipmaker can compete with Intel and AMD in terms of performance and efficiency.