Qualcomm has made significant waves in the tech sector by revealing two groundbreaking datacenter AI chips, the AI200 and AI250, scheduled for launch in 2026 and 2027, respectively. This announcement coincides with a transformative $1 billion capacity deal with Saudi Arabia’s HUMAIN initiative, positioning Qualcomm strategically in the competitive AI market.
The HUMAIN initiative and Qualcomm are targeting a robust 200 megawatts of capacity for their AI200 and AI250 rack solutions, designed to deliver high-performance AI inference services domestically and across the globe. This deal builds upon a prior letter of intent signed in May 2025, demonstrating the ongoing commitment of both parties to reshape the AI landscape.
Following the announcement, Qualcomm’s stock witnessed a remarkable surge of 15%, skyrocketing to $182.23 and hitting a 52-week high. As the third-quarter earnings have shown, the stock’s impressive performance can be attributed to strong market interest and growing investor confidence in Qualcomm’s strategic pivots away from its core smartphone business.
The newly unveiled AI200 and AI250 chips, crucially designed for AI applications requiring extensive memory, come at a time when Qualcomm is actively repositioning itself against established market leaders like Nvidia, AMD, and Broadcom. However, the chips will incorporate LPDDR memory and PCIe connections—a choice that has raised questions regarding their comparative performance against competitors’ offerings, which often utilize more advanced HBM and NVLink technologies.
Speculations on Performance
Analysts from Wolfe Research, while retaining a Peerperform rating on Qualcomm, highlighted that the technical specifications of these new chips might fall short when juxtaposed with the current market entries from competitors. The skepticism surrounding Qualcomm’s choice of LPDDR memory and reliance on PCIe could be a point of concern for potential clients evaluating performance metrics before making informed decisions.
Wolfe Research estimates the deal with HUMAIN could hold a value of approximately $1 billion. However, analysts noted that this represents a lower valuation per gigawatt when compared to AMD’s recently reported $15 billion agreement with OpenAI. Qualcomm has yet to disclose further details on the chips’ power consumption, performance metrics, or pricing strategies—factors that will critically influence their market viability.
A Competitive Landscape
Nvidia maintains a stronghold in the datacenter AI chip arena with a staggering market capitalization of $4.64 trillion and a reported revenue growth of 71.55% over the past year. In contrast, Qualcomm, which currently sits at a market cap of $185.89 billion, faces heightened competition not just from Nvidia but also from Intel, which recently announced its own Crescent Island AI chip aimed for a 2026 launch.
AMD and Broadcom continue to assert themselves with advanced chips that already hold a considerable market share and established customer relationships, presenting formidable obstacles for Qualcomm’s entry into the sector.
As Qualcomm continues to forge its path in the AI space, it has remained resilient with a 4.6% year-on-year increment in stock prices, coupled with a price-to-earnings ratio of 16.39 and a revenue increase of 15.82% last quarter. The company also maintains a quarterly dividend for its shareholders, yielding 2.18% and with the next payout expected on December 18, 2025.
With a Buy rating from Benchmark analysts and an ambitious price target of $200—and even a topside prediction of $225—the market is keenly observing Qualcomm’s steps as it seeks to carve out its niche in the rapidly evolving competitive landscape of AI datacenters.
