Amid a broad rally in AI chip stocks, Qualcomm's "cost-performance ratio" has successfully caught Wall Street's attention.

A research report released on November 10 highlights that JPMorgan maintained its Overweight rating on Qualcomm after meetings with executives, including CFO and COO Akash Palkhiwala. The bank views the company as potentially "the least expensive AI semis company."

Analyst Samik Chatterjee noted in the report that Qualcomm's diversified market strength, AI adoption across end markets, and emerging data center opportunities could drive new business growth beyond its five-year historical average.

**Data Centers: Tackling Power and Memory Bandwidth Challenges** According to the report, Qualcomm's management emphasized its data center strategy focuses on addressing power and memory-related challenges. The company believes its proven performance-per-watt efficiency in edge devices (e.g., smartphones and PCs) can extend to data centers, especially as power efficiency becomes critical for AI applications.

To achieve this, Qualcomm plans to launch two key products: the AI 200 chip (expected late 2026) for high-efficiency performance and the AI 250 chip targeting both power consumption and memory bandwidth. Management reiterated that data center revenue growth is projected to begin in FY2027, starting with AI accelerators/NPUs, followed by CPU-related revenue in FY2028, collectively creating a "multi-billion-dollar" opportunity within years.

Known customer HUMAIN is expected to start deployments by late 2026. Additionally, Qualcomm is engaging with multiple hyperscale cloud providers for its CPU and NPU offerings.

**Auto & PC: Outpacing Expectations, AI as a New Driver** Qualcomm's diversification strategy is paying off. Over the past five years, its automotive and IoT segments have achieved a CAGR exceeding 20%.

**Automotive**: Chip design orders are growing faster than internal projections. Its ADAS collaboration with BMW, deployed in the Neue Klasse platform in Europe (U.S. launch expected in Q1 2026), will expand to 130 countries, reinforcing leadership in digital cockpits, connectivity, and ADAS while unlocking software revenue potential.

**PC**: The company is steadily progressing toward its PC market goals, nearing 10% retail share in the U.S. and Western Europe. Its long-term target is $4 billion in PC revenue (12% global share) by FY2029.

**XR**: This segment holds the "most upside potential" relative to 2024 targets. As the market shifts from VR/AR to AI-powered smart glasses, Qualcomm could "far exceed" its FY2029 $2 billion revenue goal.

Meanwhile, Qualcomm’s core smartphone business remains robust, with strong premium-market demand driving non-Apple revenue growth. This stable foundation supports its expansion into new areas.

**Next Catalyst: Data Center Investor Day?** JPMorgan concluded that Qualcomm may be the "most affordable semiconductor play" for investors capitalizing on AI trends. However, patience is advised, as meaningful data center revenue growth won’t materialize until FY2027, and Apple-related adjustments take time.

A potential catalyst could be Qualcomm’s planned Data Center Investor Day in H1 2026, where further customer engagements and market opportunities may be unveiled. The bank maintains its Overweight rating, citing long-term technology leadership and diversified growth prospects.