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Qualcomm is reportedly planning to exit the server chip market

A mere year into its data centre push and the chipmaker could be calling it quits

QUALCOMM MIGHT BE CALLING TIME on its chips for servers as it looks to end its fledgeling position in the data centre world.

A person familiar with the matter blabbed the news to Bloomberg, noting Qualcommis trying to figure out if it should stop trying to play in a market dominated by Intel and IBM.

Qualcomm’s original push into the data centre world was prompted by a mission to get ARM-designed chips into servers for high-end computing – an area that rakes in large sums of money per individual chip, though the chips sell in smaller volumes than they do in smartphones and other smart gadgets.

The company started selling its Centriq 2400 chip last year, which took ARM’s architecture and had it chase Intel’s Xeon processors. While Microsoft touted interest in the chip, Qualcomm hasn’t said whether it’s been selling many of them.

The San Diego-based chipmaker hasn’t commented on its potential abandonment of the server chip market. But in discussing its latest earnings report, chief financial officer Steve Mollenkopf told analysts that Qualcomm is reducing its spendings on areas of its business that aren’t core drivers of revenue for the firm.

As such, it’s safe to hazard a guess that this means it will channel its funds into mobile and connectivity-focussed slices of silicon, as opposed to chops aimed at high-end computing in data centres.

Qualcomm does pretty well flogging mobile chips; the latest Android smartphones all tend to rock Snapdragon SoCs. But the chipmaker could be seen as reliant on the smartphone marker to make its money. If the market for mobile suddenly tumbles so to would Qualcomm’s revenues, so a bit of diversification seems like a sound plan.

But then competing against Intel is a bit of a challenge as well; just ask AMD, which has only just found its mojo again lately thanks to its Ryzen and Ryzen 2 chips able to take on Intel’s Core i range.

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