Following last quarter’s earnings, Qualcomm laid out more details in its revenue diversification strategy at their Auto and IoT investor day.

Key Takeaways

• Automotive Growth Security: Qualcomm has exceptional visibility in its automotive segment with 80% of projected revenue for the next five years already secured through design wins. The automotive TAM is expected to double from $50B to $100B by 2029, with Qualcomm targeting $8B by FY29 and having a clear path to $9B+ by FY31.
• Strong IoT Roadmap: The company projects $14B in IoT revenue by FY29, broken down into $4B from PC market penetration and $10B from traditional IoT. This includes $4B from industrial applications and $2B+ from XR, demonstrating multiple growth vectors within the segment.
• Edge AI Positioning: Qualcomm is strategically positioned to benefit from the increasing importance of edge computing and AI, particularly in automotive software-defined vehicles, XR, robotics, and industrial applications, though analysts note this will be a gradual rather than immediate impact.
• Revenue Mix Transformation: The company is executing a clear strategy to achieve a 50/50 split between handset and non-handset revenue by 2030 while maintaining operating expenses between 21-23% of revenue and supporting continued dividend growth.
• Android Leadership: Despite smartphone market maturity, Qualcomm maintains 5x the revenue of its closest competitor in premium tier Android processors and expects mid-single digit growth in the Android market over the next 5 years.

Qualcomm revealed an ambitious transformation strategy at its Investor Day that positions the company to capitalize on growth opportunities beyond its traditional smartphone business. The company aims to achieve 50% of revenue from non-handset segments by 2030, leveraging its core technology expertise across automotive, IoT, and new computing platforms.

The automotive segment demonstrates particularly strong momentum, with Qualcomm maintaining high confidence in its growth trajectory. The company projects automotive revenue to reach $8 billion by FY29, supported by an expanding TAM from $50 billion in 2024 to $100 billion in 2029, representing a 15% CAGR. Most impressively, over 80% of the cumulative automotive revenue for the next five years is already secured through design wins. The automotive strategy focuses on both infotainment systems and ADAS integration, with commercial launches of their autonomous driving stack developed with BMW expected in the second half of 2025.

In IoT, Qualcomm projects substantial growth to $14 billion by FY29, driven by a robust PC market opportunity and traditional IoT applications. The PC segment is targeted to reach $4 billion in revenue, supported by expectations that 30-50% of non-x86 notebook volumes will be addressable through their technology by 2026. Traditional IoT, including industrial applications and XR (extended reality), is expected to contribute $10 billion, with industrial IoT alone reaching $4 billion and XR exceeding $2 billion by FY29.

The Android smartphone business is projected to grow at mid-single digits over the next 5 years, driven by content increases and product mix improvements. Qualcomm maintains a dominant position in premium-tier Android processors, where they have five times the revenue of their closest competitor.

The company’s strategic shift is supported by strong financials, with operating expenses expected to remain controlled at 21-23% of revenue. Qualcomm also plans to maintain consistent shareholder returns through dividend growth in the low-to-mid single digits annually. Their focus on edge computing and AI positions them well for future technology transitions, particularly in automotive software-defined vehicles, XR, robotics, and industrial applications.

This comprehensive transformation strategy demonstrates Qualcomm’s ability to leverage its core technology leadership into multiple high-growth segments while maintaining profitability and shareholder returns.

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