Qualcomm Banks on AI to Get A Bigger Share Of The Automotive Chip Market
The CPUs and modems in Android phones are Qualcomm’s best-known products. But in recent years, it has also been offering manufacturers like GM, Hyundai, and Volvo the Snapdragon Digital Chassis, a collection of hardware chips, sensors, and software.
It is now attempting to take advantage of the hoopla surrounding generative AI to persuade automakers to purchase more of these chips and develop new applications for them, such as smart assistants that would aid drivers in navigating cities, making reservations, and performing other daily computing activities.
Qualcomm reported $1.32 billion in sales in fiscal 2022, accounting for 3% of the company’s overall sales. However, the company expects its chips to be used in cars in the coming years, with over $9 billion in sales projected in 2031. Qualcomm earns between $200 and $3,000 per car using its chips and software, and $5 per car connected to 5G through licensing fees. The company’s AI strategy includes low-power smartphone GPUs and accelerators, contrasting Nvidia’s cloud GPUs. Despite the AI boom, Qualcomm’s stock has only increased 5% in the same period.
(With inputs from Shikha Singh)
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