Nvidia and Qualcomm's Edge Computing Competition
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 hours ago
0mins
Source: Fool
- Quarterly Growth: Nvidia reported a Q1 revenue of $81.6 billion, an 85% year-over-year increase, showcasing its strong performance in artificial intelligence while reflecting its dominance with over 90% revenue from data centers.
- Edge Computing Growth: Nvidia's edge computing division saw a 29% year-over-year sales growth last quarter, indicating potential in diversifying its business despite its primary revenue from data centers, which could impact competitor Qualcomm.
- Market Potential: Precedence Research forecasts that the global edge computing market will grow at an average annual rate of 27% through 2035, potentially exceeding $6 trillion, highlighting significant growth opportunities ahead.
- Qualcomm's Competitive Edge: Qualcomm achieved a 9% revenue growth in its IoT division, making up nearly 20% of its total business, and its CEO noted that the winner in edge computing will lead the AI race, suggesting Qualcomm's strategic positioning may surpass Nvidia in this segment.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy QCOM?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on QCOM
Wall Street analysts forecast QCOM stock price to fall
16 Analyst Rating
10 Buy
5 Hold
1 Sell
Moderate Buy
Current: 228.990
Low
165.00
Averages
197.14
High
225.00
Current: 228.990
Low
165.00
Averages
197.14
High
225.00
About QCOM
Qualcomm Incorporated is engaged in the development and commercialization of foundational technologies for the wireless industry, including third generation (3G), fourth generation (4G) and fifth generation (5G) wireless connectivity, and high-performance and low-power computing, including on-device artificial intelligence. Its segments include Qualcomm CDMA Technologies (QCT), Qualcomm Technology Licensing (QTL) and Qualcomm Strategic Initiatives. QCT develops and supplies integrated circuits and system software based on 3G/4G/5G and other technologies, including radio frequency front-end, digital cockpit and advanced driver assistance and automated driving, Internet of things including consumer electronic devices, industrial devices and edge networking products. QTL grants licenses or otherwise provides rights to use portions of its intellectual property portfolio that includes certain patent rights essential to and/or useful in the manufacture and sale of certain wireless products.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Stock Market Hits All-Time Highs Amid Uncertainty; Investors Should Prepare for Corrections
- Market Performance: The S&P 500 has reached 7,580, up approximately 10.5% this year, showcasing resilience and investor confidence despite uncertainties surrounding AI, rising oil and gas prices, and increasing bond yields.
- Investor Caution Needed: While long-term investors may not need to adjust their portfolios, the risk of market corrections remains, suggesting that investors should prepare for potential declines of at least 10% in major indices, reflecting market volatility and uncertainty.
- Attractiveness of SCHD ETF: The Schwab U.S. Dividend Equity ETF (SCHD) offers a 3.44% trailing 12-month distribution yield and has gained 17.4% year-to-date, making it a popular choice for investors seeking stable passive income, particularly amid concerns over high market valuations.
- Protective Role of BND ETF: The Vanguard Total Bond Market ETF (BND) provides a high distribution yield of 4.12% and a low expense ratio of 0.03%, offering effective protection against market corrections, especially during economic downturns, where the stability and low volatility of bonds will safeguard investors.
See More
Market Corrections and Investment Protection Strategies
- Definition of Market Correction: A market correction is defined as a major index like the S&P 500 falling at least 10% from its recent peak, which occurs more frequently than investors might think, suggesting that investors should remain vigilant and ready to adjust their strategies accordingly.
- S&P 500 Performance: As of now, the S&P 500 has reached 7,580 points, up approximately 10.5% this year, demonstrating market resilience and investor confidence despite uncertainties related to artificial intelligence, rising oil and gas prices, and increasing bond yields.
- Portfolio Protection Recommendations: Investors are advised to consider purchasing the Schwab U.S. Dividend Equity ETF (SCHD), which boasts a 12-month distribution yield of 3.44% and has consistently increased its dividends since its launch in 2011, making it suitable for those seeking stable income.
- Advantages of Bond ETFs: The Vanguard Total Bond Market ETF (BND) offers a high distribution yield of 4.12% with an expense ratio of just 0.03%, with over 69% of its portfolio invested in U.S. government bonds, making it a solid choice for protection during economic uncertainty, particularly in recessionary scenarios.
See More
AMD and Qualcomm Stocks Surge 40% Amid AI Demand
- AMD's Strong Performance: AMD reported a 38% year-over-year revenue increase to $10.3 billion in its Q1 earnings released in early May, driven by a 57% surge in its data center segment to $5.8 billion, indicating robust demand for AI hardware, with a projected Q2 revenue of $11.2 billion implying a 46% year-over-year growth.
- Broadcom's Impressive Growth: In its fiscal Q1 2026, Broadcom's revenue rose 29% to a record $19.3 billion, with AI revenue more than doubling by 106% to $8.4 billion, reflecting strong demand for custom chips, and it anticipates about $22 billion in Q2 revenue, up 47%.
- Qualcomm's Stock Volatility: Qualcomm's stock surged 40% in May, yet its core business is shrinking, with a 3% year-over-year revenue decline in Q2 due to a 13% drop in handset chip sales, and management expects further sequential declines, although investors remain optimistic about a potential deal with ByteDance.
- Market Outlook Uncertainty: Despite strong performances in May, AMD and Broadcom's high P/E ratios of 69 and over 40 reflect market expectations for sustained AI growth, while Qualcomm's lower ratio of around 21 indicates challenges in its core business, making future earnings reports a key focus for investors.
See More
US Stocks Rise Slightly, Tech Stocks Show Strong Rebound
- Strong Labor Market: US April JOLTS job openings unexpectedly rose by 731,000 to a 23-month high of 7.618 million, surpassing expectations of 6.866 million, indicating labor market resilience and driving stock market gains, particularly in tech stocks.
- Tech Stock Surge: Hewlett-Packard Enterprise (HPE) shares surged over 25% after reporting Q2 adjusted EPS of 79 cents, significantly above the consensus estimate of 54 cents, and raising its full-year adjusted EPS forecast to $3.35-$3.45, reflecting robust growth in AI-driven demand.
- Market Volatility Factors: Despite overall market gains, initial declines occurred due to uncertainty surrounding a US-Iran ceasefire, with oil prices slightly down as President Trump stated negotiations with Iran are progressing “at a rapid pace,” potentially affecting investor sentiment.
- Software Stocks Under Pressure: Intuit (INTU) saw its stock drop over 10% after Goldman Sachs downgraded it to sell with a price target of $276, leading to a broader decline in the software sector, highlighting a divergence in market performance among tech stocks.
See More
AMD Data Center Revenue Grows 57% in Q1 2026
- AMD Earnings Highlights: AMD reported a 38% year-over-year revenue increase in Q1 2026, reaching $10.3 billion, with its data center segment growing 57% to a record $5.8 billion, driven by strong demand for EPYC server processors and Instinct GPUs, marking a clear inflection point in the company's growth trajectory.
- Broadcom's Strong Performance: Broadcom's fiscal Q1 2026 revenue rose 29% to $19.3 billion, with AI revenue more than doubling by 106% to $8.4 billion, indicating a surge in demand for custom accelerators and networking chips for major cloud companies, and it expects about $22 billion in Q2 revenue, up 47%.
- Qualcomm Market Dynamics: Qualcomm's stock surged in May, partly due to speculation about a deal with ByteDance to supply millions of custom AI data center chips; although the agreement remains unconfirmed, optimism about its AI business prospects has driven the stock price higher, with a current P/E ratio of around 21.
- Investor Focus on Future: Despite strong performances in May, investors should exercise caution as AMD and Broadcom trade at forward P/E ratios of 69 and over 40, reflecting expectations for sustained AI growth, yet any signs of demand cooling could impact stock prices, necessitating patience for more robust results.
See More
Nvidia and Qualcomm's Edge Computing Competition
- Quarterly Growth: Nvidia reported a Q1 revenue of $81.6 billion, an 85% year-over-year increase, showcasing its strong performance in artificial intelligence while reflecting its dominance with over 90% revenue from data centers.
- Edge Computing Growth: Nvidia's edge computing division saw a 29% year-over-year sales growth last quarter, indicating potential in diversifying its business despite its primary revenue from data centers, which could impact competitor Qualcomm.
- Market Potential: Precedence Research forecasts that the global edge computing market will grow at an average annual rate of 27% through 2035, potentially exceeding $6 trillion, highlighting significant growth opportunities ahead.
- Qualcomm's Competitive Edge: Qualcomm achieved a 9% revenue growth in its IoT division, making up nearly 20% of its total business, and its CEO noted that the winner in edge computing will lead the AI race, suggesting Qualcomm's strategic positioning may surpass Nvidia in this segment.
See More
Stock Market Hits All-Time Highs Amid Uncertainty; Investors Should Prepare for Corrections
- Market Performance: The S&P 500 has reached 7,580, up approximately 10.5% this year, showcasing resilience and investor confidence despite uncertainties surrounding AI, rising oil and gas prices, and increasing bond yields.
- Investor Caution Needed: While long-term investors may not need to adjust their portfolios, the risk of market corrections remains, suggesting that investors should prepare for potential declines of at least 10% in major indices, reflecting market volatility and uncertainty.
- Attractiveness of SCHD ETF: The Schwab U.S. Dividend Equity ETF (SCHD) offers a 3.44% trailing 12-month distribution yield and has gained 17.4% year-to-date, making it a popular choice for investors seeking stable passive income, particularly amid concerns over high market valuations.
- Protective Role of BND ETF: The Vanguard Total Bond Market ETF (BND) provides a high distribution yield of 4.12% and a low expense ratio of 0.03%, offering effective protection against market corrections, especially during economic downturns, where the stability and low volatility of bonds will safeguard investors.
See More
Market Corrections and Investment Protection Strategies
- Definition of Market Correction: A market correction is defined as a major index like the S&P 500 falling at least 10% from its recent peak, which occurs more frequently than investors might think, suggesting that investors should remain vigilant and ready to adjust their strategies accordingly.
- S&P 500 Performance: As of now, the S&P 500 has reached 7,580 points, up approximately 10.5% this year, demonstrating market resilience and investor confidence despite uncertainties related to artificial intelligence, rising oil and gas prices, and increasing bond yields.
- Portfolio Protection Recommendations: Investors are advised to consider purchasing the Schwab U.S. Dividend Equity ETF (SCHD), which boasts a 12-month distribution yield of 3.44% and has consistently increased its dividends since its launch in 2011, making it suitable for those seeking stable income.
- Advantages of Bond ETFs: The Vanguard Total Bond Market ETF (BND) offers a high distribution yield of 4.12% with an expense ratio of just 0.03%, with over 69% of its portfolio invested in U.S. government bonds, making it a solid choice for protection during economic uncertainty, particularly in recessionary scenarios.
See More
AMD and Qualcomm Stocks Surge 40% Amid AI Demand
- AMD's Strong Performance: AMD reported a 38% year-over-year revenue increase to $10.3 billion in its Q1 earnings released in early May, driven by a 57% surge in its data center segment to $5.8 billion, indicating robust demand for AI hardware, with a projected Q2 revenue of $11.2 billion implying a 46% year-over-year growth.
- Broadcom's Impressive Growth: In its fiscal Q1 2026, Broadcom's revenue rose 29% to a record $19.3 billion, with AI revenue more than doubling by 106% to $8.4 billion, reflecting strong demand for custom chips, and it anticipates about $22 billion in Q2 revenue, up 47%.
- Qualcomm's Stock Volatility: Qualcomm's stock surged 40% in May, yet its core business is shrinking, with a 3% year-over-year revenue decline in Q2 due to a 13% drop in handset chip sales, and management expects further sequential declines, although investors remain optimistic about a potential deal with ByteDance.
- Market Outlook Uncertainty: Despite strong performances in May, AMD and Broadcom's high P/E ratios of 69 and over 40 reflect market expectations for sustained AI growth, while Qualcomm's lower ratio of around 21 indicates challenges in its core business, making future earnings reports a key focus for investors.
See More
US Stocks Rise Slightly, Tech Stocks Show Strong Rebound
- Strong Labor Market: US April JOLTS job openings unexpectedly rose by 731,000 to a 23-month high of 7.618 million, surpassing expectations of 6.866 million, indicating labor market resilience and driving stock market gains, particularly in tech stocks.
- Tech Stock Surge: Hewlett-Packard Enterprise (HPE) shares surged over 25% after reporting Q2 adjusted EPS of 79 cents, significantly above the consensus estimate of 54 cents, and raising its full-year adjusted EPS forecast to $3.35-$3.45, reflecting robust growth in AI-driven demand.
- Market Volatility Factors: Despite overall market gains, initial declines occurred due to uncertainty surrounding a US-Iran ceasefire, with oil prices slightly down as President Trump stated negotiations with Iran are progressing “at a rapid pace,” potentially affecting investor sentiment.
- Software Stocks Under Pressure: Intuit (INTU) saw its stock drop over 10% after Goldman Sachs downgraded it to sell with a price target of $276, leading to a broader decline in the software sector, highlighting a divergence in market performance among tech stocks.
See More
AMD Data Center Revenue Grows 57% in Q1 2026
- AMD Earnings Highlights: AMD reported a 38% year-over-year revenue increase in Q1 2026, reaching $10.3 billion, with its data center segment growing 57% to a record $5.8 billion, driven by strong demand for EPYC server processors and Instinct GPUs, marking a clear inflection point in the company's growth trajectory.
- Broadcom's Strong Performance: Broadcom's fiscal Q1 2026 revenue rose 29% to $19.3 billion, with AI revenue more than doubling by 106% to $8.4 billion, indicating a surge in demand for custom accelerators and networking chips for major cloud companies, and it expects about $22 billion in Q2 revenue, up 47%.
- Qualcomm Market Dynamics: Qualcomm's stock surged in May, partly due to speculation about a deal with ByteDance to supply millions of custom AI data center chips; although the agreement remains unconfirmed, optimism about its AI business prospects has driven the stock price higher, with a current P/E ratio of around 21.
- Investor Focus on Future: Despite strong performances in May, investors should exercise caution as AMD and Broadcom trade at forward P/E ratios of 69 and over 40, reflecting expectations for sustained AI growth, yet any signs of demand cooling could impact stock prices, necessitating patience for more robust results.
See More
Nvidia and Qualcomm's Edge Computing Competition
- Quarterly Growth: Nvidia reported a Q1 revenue of $81.6 billion, an 85% year-over-year increase, showcasing its strong performance in artificial intelligence while reflecting its dominance with over 90% revenue from data centers.
- Edge Computing Growth: Nvidia's edge computing division saw a 29% year-over-year sales growth last quarter, indicating potential in diversifying its business despite its primary revenue from data centers, which could impact competitor Qualcomm.
- Market Potential: Precedence Research forecasts that the global edge computing market will grow at an average annual rate of 27% through 2035, potentially exceeding $6 trillion, highlighting significant growth opportunities ahead.
- Qualcomm's Competitive Edge: Qualcomm achieved a 9% revenue growth in its IoT division, making up nearly 20% of its total business, and its CEO noted that the winner in edge computing will lead the AI race, suggesting Qualcomm's strategic positioning may surpass Nvidia in this segment.
See More
