Qualcomm investor day to detail data center plans Wednesday

Investing.com -- Bank of America has raised its price target on Qualcomm (QCOM) from $165 to $195, though the firm is maintaining its "Underperform" rating ahead of the company’s Investor Day on Wednesday, June 24.

The revised target is the result of BofA rolling its valuation forward to calendar year (CY) 2028 estimates, applying a 15x price-to-earnings (P/E) multiple. The bank’s underlying financial estimates remain unchanged, which includes projecting roughly $2.5 billion in CY 2028 AI revenue.

During the upcoming Investor Day, Qualcomm is expected to outline its strategic shift away from handset reliance toward a broader AI compute platform spanning edge, automotive, internet of things (IoT), and data center applications. Management’s ultimate goal is to demonstrate a path to generating the majority of its sales from non-smartphone segments by the end of the decade.

Specifically, BofA anticipates Qualcomm will provide five key updates:

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  Data Center Market Sizing: Outlining a near-term addressable opportunity of $2 billion to $5 billion by fiscal years 2027–2028.

  
  


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  HUMAIN Agreement Progress: An update on the 200-megawatt agreement for accelerators, which is expected to ramp up in the second half of 2026.

  
  


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  Hyperscaler ASIC Deal: Details on a previously announced multi-generation ASIC contract.

  
  


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  Dragonfly Roadmap: Performance targets and specifics for the AI200 and AI250 inference-focused data center accelerators.

  
  


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  Customer Pipeline: Additional AI customer announcements and design wins.

  
  

Despite the increased price target and broader AI roadmap, Bank of America remains cautious for two primary reasons:

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   Priced to Perfection: BofA’s scenario analysis suggests that even if Qualcomm hits $10 billion in CY 2028 data center and AI sales at 20% earnings before tax (EBT) margins, that success is already reflected in the stock’s current share price.

   
   


2. 
   

   Execution Risk in a Crowded Market: Current data center revenues remain minimal. Qualcomm still needs to prove it can scale its strong consumer-device CPU and NPU performance to handle complex data center workloads. Furthermore, the company faces steep competition from entrenched incumbents, including Nvidia, Broadcom, AMD, Marvell, Arm, and Intel.

   
   

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