Qualcomm Transitioning into Intelligent Edge Firm on AI Opportunity
Qualcomm has made a name for itself on developing chips that power smartphones. But, facing smartphone saturation and stiff competition in the business, the company is already plotting its next phase of growth. Its primary focus is transitioning from a communications company to an intelligent edge computing heavyweight. Its focus is on artificial intelligence, a technology already causing havoc and ripple effects in various sectors.
Qualcomm AI Transition
According to senior vice president Alex Katouzian, the future is all about developing chips that will enable AI-powered devices. The chips that the company is working on should help smartphones harness the full potential of AI technology, right from processing photos to detecting malware. In addition, it should harness search on the internet and enable people to access services or networks by simply tapping their phones.
Qualcomm is positioning itself amid the AI arms race, having already shipped nearly 2 billion worth of AI-capable products. Nevertheless, it is Nvidia that has appeared to have an edge over other chip makers and is seen as a front-runner with its graphics processing units that are in high demand. The stock has been one of the best performing, with the company’s market nearing the $ 1 trillion milestone.
Nvidia has become a Wall Street darling in the aftermath of the company issuing a better-than-expected outlook. The company’s revenue outlook for the current quarter beat estimates by more than 50%, fueled by expected demand for AI-capable GPUs. In contrast, Qualcomm issued a disappointing outlook as it continues to face sluggish demand for mobile devices from where it accrues most of its remains on chip sales.
AI Chips Opportunity
Demand for AI-capable chips has been rising as the growth in connected devices and data traffic continues to fuel a significant increase in data center costs. It’s becoming increasingly clear that hosting all data from connected devices on the cloud might not be possible. Increased focus on AI is expected to trigger a significant increase in AI-powered chips, which should trigger strong business for Qualcomm and the like.
Qualcomm executives insist that the future of AI will require more computing power. Given that the cloud alone would not be able to provide the much-needed power, the company has already sensed a window of opportunity that it plans to take advantage of with its transition into an intelligent edge computing firm.
However, it is one of many companies pumping billions of dollars into the emerging opportunity. Nvidia has been the front-runner with the likes of Arm Ltd and Asustek Computer, also working on chips that will power AI-related services. Stiff computing is good for the overall industry as it should give rise to powerful chips capable of unlocking the full potential of revolutionary technology.
Nevertheless, the technology faces an uncertain future amid calls for increased regulation. There are growing concerns that if tech companies are left to do as they wish with the technology, there could be serious ramifications given that the technology supersedes human intelligence. Tesla CEO Elon Musk has been the most vocal in calling for increased regulation.
