How Qualcomm is cementing its spot in the AI race

Qualcomm (QCOM) is set to power Microsoft's (MSFT) next generation of Windows PCs with its artificial intelligence chips. Qualcomm COO and CFO Akash Palkhiwala joins Market Domination Overtime to break down the company's latest AI moves.

Palkhiwala explains that the Snapdragon X Elite chips will have three key new areas: "best-in-class" processing, long battery life, and an "incredible set of AI experiences." Qualcomm announced more than 20 devices that will be enabled by the chip, which will be available soon for consumers to purchase.

"We're uniquely positioned to be the primary beneficiary of that growth in AI PCs, and we have a chip that significantly out-contributes any of our competitors," Palkhiwala says. He adds that as the market transitions, Qualcomm has an "opportunity to be a leader," and explains that it is "the beginning of a new chapter."

For more expert insight and the latest market action, click here to watch this full episode of Market Domination Overtime.

This post was written by Melanie Riehl

Video transcript

Looking to advance its A I play the company set to power Microsoft's next generation of Windows P CS with its A I chips.

That announcement coming today at that Microsoft event that our Dan, how he told us about earlier.

Joining us now to discuss Q Chief Financial Officer and Chief operating officer A CPA.

It's great to see you again.

Thanks for being here, great being here, Julie, how are you?

I'm doing well.

Thank you.

I'm excited to get my eyes on these new um P CS and to test them out.

Uh What are the snapdragon chips that are going into these P CS?

What kind of capabilities are we gonna see from this new generation?

Yeah, so first of all, we are very excited about the announcement today, Microsoft talked about the next generation of P CS with copilot plus bringing in some incredible A IX experiences for the consumers into the devices.

And so we're great greatly looking forward to those devices lodged.

Um What Qualcomm brings to the device is a specific chip that we built for this purpose.

It's called the snapdragon exit chip and it shows three key new areas.

The first one is uh the best in class processing exceeding all other um all other P CS in terms of performance.

The second is very, very good battery life.

It shows very long battery life, uh several times extend, extending greater than 20 hours.

And this is not something that uh P CS have had before.

And then the third is this incredible set of A I experiences that Microsoft outlined today that for the foreseeable future, only available on Qualcomm Snapdragon exo devices, we announced more than 20 devices that are all enabled by our chip that will be soon be available for consumers to buy.

And you know, we have been talking a lot about the just vast demand that we are seeing for all of these types of A I chips from you and your competitors.

There was a comment today from one of the Microsoft executives that the company expects over 50 million A IP CS will be bought over the next year.

What does this mean for Qualcomm's saless and bottom line?

That kind of demand?

Yeah, I think it's an incredible opportunity for us.

We are uniquely positioned to be the primary beneficiary of uh of that growth in A IP CS.

And we have a chip that significantly uh out contributes any of our competitors.

So we're looking forward to it.

We think the PC is in the first innings of this uh new uh new generation, the new form factors, the new performance factors.

And Qualcomm is the one making it happen along with Microsoft Akash.

Can you give me any numbers around it?

About what, what contribution you're gonna see perhaps to sales this year?

I think we're at the front end of a very long run for the company.

This is a massive silicon market and it's not often in our generation that you get to enter a new market like this, that is at this scale with a unique performance advantage product that is leadership and it's going to be sustained leadership for a long period of time.

So we're looking for and on a similar front, you talked about your offerings versus your competitors.

So if we're expecting this kind of growth in the PC market, um what kind of market share do you expect to take, say from the Intel and AM DS of the world who also make chips that power P CS?

Yeah.

II I think the way you should think about it is the market transition is happening and Qualcomm is positioned to be the leader in the new PC.

And, and that really you can kind of extrapolate that into a different set of numbers and we'll see how it plays out.

But I really do think we have the best product in the market and uh and we have this opportunity to be a leader in a new market beyond what we've already done in uh in smartphones and in automotive and Xr and other areas.

Well, and speaking of all the areas that you're in a cash, you know, I gotta, I gotta admit to you, we talk about NVIDIA a lot on this show, right?

It's of high interest to investors.

Um How should we be thinking about the Chip universe right now when people are so focused on NVIDIA, how should they be thinking about a Qualcomm and its role in this whole A I revolution?

Yeah, I think that's a great question if you think about A I, it took off in the cloud first.

And as you know, we don't have much of a presence on the cloud side, but we are the clear leader on device and what we're seeing happening.

And, and the event today from Microsoft was really the beginning of that change is that we're gonna see the migration of A I from the cloud in addition to the cloud to happen on the device as well.

And, and the PC is just the first device where Qualcomm is enabling it.

And we see we get to see the benefit of it, but you're going to see it happen across phones, tablets, automotive industrial devices, and Qualcomm will be enabling it across all of these things.

And the way to think about uh on device A I is really, it is something that enables use cases that cannot happen in the cloud because it has privacy benefits, security benefits, it has latency benefits and it has a very significant cost benefit because once you buy the device, uh the compute capability is already available on the device and you can run use cases really for free on an incremental basis.

And, and Qualcomm is uniquely positioned to make that happen.

And that's uh that's why this is incredibly exciting and it's, it's a beginning of a new chapter for us.

Akash, great to see you.

Thanks for joining us.

Great to see you as well.

Thank you very much.