Qualcomm jumps 12% to a record high as the AI device boom reshapes its valuation.

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Driven by investors betting on the prospects of AI edge computing devices, automotive chips, and data center business, Qualcomm's stock price has reached a historic high. Its core position in the "physical AI" wave is being repriced by Wall Street.

On Friday, Qualcomm's stock surged 12% in a single day, hitting a new all-time high. The cumulative increase over the past month has reached 75%. The day before, Qualcomm announced a chip supply agreement with automotive group Stellantis, and there are also reports that Qualcomm is working with OpenAI to develop AI chips to power terminal devices run by AI agents.

Ivan Feinseth, an analyst at Tigress Financial Partners, maintains a buy rating on Qualcomm. He said investors are "awakening" to realize that Qualcomm will regain its former glory and lead the revolution of interconnected devices.

He is optimistic about the upcoming devices from Qualcomm's collaboration with OpenAI, describing it as "a phone with AI as the basic operating system that can accomplish everything."

From Smartphones to the Internet of Everything, Qualcomm Consolidates Its Core Position in Edge AI

Although Qualcomm has fallen behind giants like Nvidia in providing computing power for AI models and cloud workloads, the company is leveraging its long-term dominance in the smartphone sector to expand into glasses, cars, robots, and other interconnected devices, building a core ecosystem for "edge AI."

Qualcomm's chips are currently embedded in Microsoft's Surface series PCs, as well as Google and Meta's smart glasses products.

Its Arm-based processors excel in energy efficiency, offering a differentiated competitive advantage compared to traditional central processors from Intel and AMD, fitting well with edge devices' demand for low power computing.

Automotive Business Accelerates, Stellantis Partnership Launched

Qualcomm continues to deepen its presence in the automotive sector. On Thursday, Stellantis announced it will use Qualcomm's Snapdragon processors to provide a unified computing platform for cockpit, in-car connectivity, and advanced driver assistance systems in its vehicles.

Stellantis has a vast portfolio of brands, including Alfa Romeo, Chrysler, Dodge, Fiat, Jeep, and Maserati.

Ned Curic, Head of Product Development at Stellantis, said at Thursday's Investor Day that customers will be able to enjoy a "smooth, immersive, and safe autonomous driving experience and choose from multiple driving modes" in cities and on highways.

This agreement is not unique. Qualcomm has previously signed similar partnerships with Bosch, Volkswagen, Hyundai, and BMW. In its latest financial report, Qualcomm's automotive business revenue grew 38% year-over-year to $1.3 billion, with its autonomous driving system running on more than 1 million cars powered by Qualcomm processors.

Data Center Chips Break New Ground, New Business Expands Imagination Space

The sharp rise in stock price on Friday also reflects investors' high expectations for Qualcomm's entry into the brand new data center chip business.

Last year, Qualcomm announced the launch of customized AI accelerator chips AI200 and AI250. Compared to Nvidia GPUs, these chips offer higher programmable flexibility and are planned for launch later this year, to be delivered as complete rack systems, similar to Nvidia's Vera Rubin and AMD's upcoming Helios system.

Qualcomm CEO Cristiano Amon said in the April earnings call that the company would begin shipping data center chips to "a major hyperscale cloud service provider" within this year.

The market expects Amon to deliver a keynote address at Computex in Taiwan on June 2, which may reveal more progress; Qualcomm's Investor Day is also scheduled for June 24.

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