Qualcomm shares surged to a record high on Tuesday after reports revealed that the chipmaker had secured a major deal to provide millions of specialised artificial intelligence chips to ByteDance, TikTok’s parent company. The agreement represents a significant step in Qualcomm’s efforts to reduce its reliance on the slowing smartphone sector and expand its presence in the rapidly growing AI data centre market.
The deal reportedly involves application-specific integrated circuits (ASICs), which ByteDance intends to use extensively for its AI agent technology. Sources familiar with the discussions said the Chinese tech group plans to acquire millions of the custom-built chips. The collaboration is also expected to include manufacturing support, with Qualcomm assisting ByteDance in bringing its already-developed chip design into production.
Both Qualcomm and ByteDance declined to issue statements regarding the reports.
The development sparked a strong rally in Qualcomm (QCOM) shares, which climbed as much as 8.3 per cent during trading to reach a new all-time high of USD247.91. The stock later closed more than 5 per cent higher, surpassing previous records and extending an already impressive run for the company. Over the past year, Qualcomm has generated a total shareholder return of around 68 per cent, lifting its market value to nearly USD258B.
For Qualcomm Chief Executive Officer Cristiano Amon, the ByteDance deal reinforces a strategy he has consistently highlighted to investors in recent months. During Qualcomm’s second-quarter earnings call in April, Amon said the company had secured a “leading hyperscaler custom silicon engagement” and described it as a long-term, multi-generation partnership, with initial deliveries expected later this year. Although he did not identify the customer at the time, the remarks helped fuel gains in Qualcomm’s stock. Securing ByteDance as a key client now gives tangible backing to the company’s AI growth ambitions.
Amon has previously detailed a three-part strategy focused on custom ASICs, inference accelerators and central processing units as Qualcomm expands deeper into data centres and physical AI technologies. The company is expected to provide additional updates on these plans during its Investor Day on June 24.
