At 40, Qualcomm Diversifies Beyond Mobile to Auto, Edge Al, Data Center and Beyond

From powering the mobile revolution to leading the charge into the AI era—how did Qualcomm evolve over 40 years into a global tech leader? 🌏

Durga Malladi, Senior Vice President and General Manager at Qualcomm, joins The Six Five Summit as an Intelligent Edge Spotlight to explore this decades-long evolution. He joins host Daniel Newman for a pivotal discussion, recorded live from the NASDAQ in New York City, on Qualcomm's incredible journey to becoming a leading force in computing, shaping the future of AI across diverse technological territories. 

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Key takeaways include:

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🔹Qualcomm's Wireless to AI Evolution: Explore Qualcomm's nearly three-decade transformation, from pioneering CDMA to leading 5G and 6G, and their pivotal shift to high-performance, energy-efficient computing at the heart of the AI revolution.

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🔹Diversifying Beyond Smartphones: Delve into Qualcomm's expansive move into industries like automotive, PC, XR, and IoT, showcasing their transition into a comprehensive computing company impacting diverse markets.

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🔹Innovating for Data at the Edge: Understand the potential and challenges of managing and utilizing vast data, driving Qualcomm's innovation in data centers, edge AI, and critical industrial use cases.

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🔹Pioneering Future AI Directions: Gain reflections on the market's perception of Qualcomm's diverse innovations and the exciting future directions the company is charting in AI and across the broader technology landscape.

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Learn more at Qualcomm.

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Watch the full video at Six Five Media, and be sure to subscribe to our YouTube channel, so you never miss an episode.

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Or listen to the audio here:

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Daniel Newman: The Six Five Summit is here. We are actually in New York City at the NASDAQ for a conversation talking about the future of AI. I've got none other than Durga Malladi. Durga Qualcomm. 40th anniversary. We are here at the NASDAQ shooting the Six Five Summit video. First of all, welcome back. Good to see you.

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Durga Malladi: Good to see you again. Yeah, really, it feels nice to be here.

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Daniel Newman: Yeah, it's great to be looking out the backdrop of New York City. You know, a lot of the big shows that I think all of us watch, CNBC shot right in here. That's right, the backdrop. It looks like it was a great day. I had a few minutes to attend the 40th anniversary party. But you've been with the company, I don't know, nearly three decades now. You've been through the CDMA era, you've been through 3G, 4G, 5G6. Should I say been through, but you're getting there. Talk a little bit about kind of what it has been like to be part of this company, this culture, this evolution and you know, kind of what the journey's looked like so far.

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Durga Malladi: I think Qualcomm as a company, we kind of symbolize what it takes for just a bunch of smart people coming together and taking on challenges which seem so impossible. But then by the time you get to it, then you just keep moving on to the next one. Our evolution as a company. Back when I joined, yeah, it's my 28th year, so it feels quite both humbling and kind of I'm in a reflective mood just in terms of thinking about 40 years is quite a journey for us in Qualcomm. But you know, one of the nicest and the best things in Qualcomm is the ability to innovate and reinvent ourselves every so often. And I've been through several of those reinventions of us, so it feels quite something. We started off as a wireless communications company. We still are, but we've added so much more since then. We've been so many generations of wireless technology and at some point we gradually transformed into a high performance computing company in addition to wireless communications. So here we are 40 years later. It's been quite a ride and quite a journey.

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Daniel Newman: Now you're really becoming a compute company. I mean you talk about, you know, handsets. Yeah, part of your business, ip, part of your business, of course, but like, you know, autonomous, you know, vehicles and ADAs, a big part of the business models. And on device AI become a big part of your business. Talk about that journey. Because you have a big remit around AI now.

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Durga Malladi: That's right.

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Daniel Newman: So you're doing a lot more, but you're really a computing company now with a pretty impressive AI story. So take me from the radio and mobile to this kind of era of compute and AI.

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Durga Malladi: There is an analogy in history that as you start the transport was no longer the question anymore. Yeah, we could go to much higher data rates, but the natural question was, what are you going to do with all that data? And the natural thinking back then was, well, you got to have a reasonable amount of computing in a phone. Back then were still phones. And that was the first time we said, okay, we got to start getting into it's got to be high performance, but also energy efficient computing because you have to make it work in a phone and if you can make it work there, you can make it work anywhere else. That was the beginning of our transformation into a computing company. And gradually, as we invested more and more into it for the next few years, we invested heavily into all the peripherals, not just the processors, but multimedia, camera, video, display. And when it all started coming together, I think the next time we then started thinking about it was towards the birth of 5G, like in 2016, 2017 timeframe. And he said, we've got to take it to the next level and not just relegate ourselves just to smartphones, but go from there into all the other industries. Automotive and PCs were one of the first ones that we started thinking about. And gradually on top of that, we started layering in XR and IoT devices, consumer and industrial IoT. And if I just look back in the last eight or nine years, oh boy, we've come such a long way since then. 

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And the third, I would argue in terms of high performance computing, our transition was as we were paying attention to, in addition to data processing. Well, how exactly do you do that? And there are other ways of actually doing that processing using AI. And around that time we decided, okay, we have to be in a position to bring in AI into devices into devices, because you can always run it on the cloud and that will continue to improve. But we wanted to make sure that it comes into devices. So about five years back or so, just two years after the transformer networks came in, we really started looking at how do you bring generative AI into devices? And look around you today, between AI, PCs, smartphones, infotainment, or as we call a digital cockpit inside an automotive, any kind of an automobile, ADAS is a natural extension from then onwards into automotive. Both of them heavily involve AI. And these days, now we use AI in every kind of a device that we can think of. That's been quite a journey. So at this point in time, as we started looking at okay, what comes next? Very recently we then started talking about data centers because all the lessons that we've learned with high performance and energy efficient computing with AI, we decided, yeah, actually all those attributes make sense in data centers as well. So the last two, three weeks have been extremely busy for us between the Middle east and Computex and a lot of the announcements that came in from there. So we are very excited, I'm personally extremely excited about our next journey into this era.

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Daniel Newman: I'm still a little hung up on the comment you made about what are we going to do with all this data? And going back years, it feels like that's a bit of the theme that we as a society have right now. The same questions being what are we going to do with all these data centers? You hear about all these CapEx and all these servers and then you hear about. And I think what happens is innovation kind of. We build the. It's like the roads and it's the pipe, right, to create growth. And then all of a sudden innovators come in behind the developers, the ones that created the app ecosystem. I mean, there's a period of time like I'm sure when you're thinking Back to like 3G and phones and nobody knew an app ecosystem was going to come and now it's just become totally part of our, it's ubiquitous with our lives. But I want to just double click a little bit because you have made this impressive transformation. I've documented it a number of times, and talk about it pretty perpetually because I sometimes think it's misunderstood. I think sometimes Qualcomm doesn't get enough credit. Some of the areas I think is. One is the diversification journey that you've been on. You diversified into compute, but then you diversified into the auto space in a big way. I mean, nearly $50 billion of design pipeline. You've made a big leap into the edge AI for industrial use cases. You had a partnership with Palantir that you announced. 

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But I still think that one of the biggest opportunities Durga is actually going to be bringing like XR and iot. All those things come back to life with edge data and AI and you seem to want to play a really big role. And now you're also, like you said, you kind of quietly said it, but you're also getting into the data center. So you go back 10 years, you're basically a handset company now you are a hand handset and IP, but you're also PCs and devices. Your XR, your automotive, your, the edge data, which obviously even naturally takes you into robotics. So, you know, the TAM is growing. It feels to me like, you know, maybe the right way to ask you this question is what do you think are the things that you really, the market maybe doesn't fully see and appreciate about all the great innovation that's being developed at Qualcomm? And what do you kind of hope the market is able to see over these next couple of quarters and years?

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Durga Malladi: I think for the longest period of time, Qualcomm has always been known as a wireless communications company and effectively it's about connectivity into all kinds of devices around us. I still feel sometimes that, of course, people like you and a lot of others actually do recognize the fact that we've transitioned, a very successful transition into a computing company in addition to communications company. But I think there is still something else that is not fully understood. There is an association of Qualcomm with smartphones. They continue to be a very important part of our portfolio, but we are so much more than that, especially with PCs, XR devices and IoT devices. We'll come back to automotive. It's a place where that's not. These are not like PCs, for example. It's like a really mature industry at one level. But then the fact that we were able to come in and bring in AI based PCs, AI algorithms running inside your PC without necessarily going back to the cloud and you can always use connectivity to complement what you're doing, that's a place where I think there's a lot of analysts who are aware of it, but the market is gradually sitting up and taking notice and saying, okay, wow. I mean, there's a bunch of AI PCs out there. That's still a story that still continues to evolve, I would say. And I spent time actually explaining ourselves beyond smartphones, the same thing. By the way, watch out for XR space. Because when you think of XR, you think of some. You know, back in the day there were these goofy looking glasses that someone would wear. That's not the case anymore. You know, today you can actually walk into a store and get a pretty good Ray Ban glasses which look no different from your regular ones, except there's a camera in it, there's a microphone in it, you can take voice calls, you can actually do, the other person can see what you're doing. This enormous amount of processing that actually is needed to get it there in a form factor that looks like an XR device. 

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So that's quite something actually. And I think people will be surprised to see how far we've come and how much Qualcomm has permeated into all kinds of devices that you might not necessarily associate us with. And switching to. When I go into industrial and consumer IoT devices, from wearables to industrial equipment, it's all about AI processing. There's so much of data, especially domain specific data that's out there, but the algorithms make the devices so much smarter. And it's quite impressive to see the applications coming in in the industrial sector. You know, that's been a specific portfolio of ours where the growth has been very slow for the longest period of time. But with the injection of generative AI and AI applications overall, it's come along a long way. Automotive, I think we've right back maybe seven, eight years back when we started splitting how we thought about automotive, we said, okay, first there's the digital cockpit. This is the interface between the driver and what's around you.  That's just the basic interface. And see so much of AI voice activated processing that occurs. You can actually point your finger like this and say, roll down this window. And then it comes down. There's gesture recognition along with infrared sensors which are inside the vehicle that can do this. It's quite something. 

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By the way, all of that processing, once again done by Qualcomm. I think in that space people are waking up to the reality that we are there. And so I almost feel like this is a story that we'll continue to tell about ourselves. Not many people have paid attention to, but the quiet thing that we did, we said, hey, by the way, we are now getting into data centers. That is going to be a place that I think people should watch out for because high performance computing normalized by energy efficiency is going to be a very important attribute as we go forward. Tons and tons of data to process energy is at a premium. So low power based, high performance computing is key for us.

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Daniel Newman: I 100% agree. We need to get more efficient. The energy race, the AI race will follow it. And so if you can only solve it two ways, build more energy, which is complicated and is going to take a lot of time, especially if we want to do it clean. And the alternative is build more efficient architectures, which is something that Qualcomm has long specialized in.

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Durga Malladi: That's right.

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Daniel Newman: Durga, I want to say thank you for making your 40th anniversary not yours, but Qualcomm's 40th anniversary part of the Six Five Summit. This year I see significant TAM expansion. I see a path into so much more than even what Qualcomm's doing today. I look at things like, you know, robotics, which all this so logically fits, and I see a strong path. And of course, we'll be watching very closely how this evolves in the data center. We know in terms of low power connectivity at the edge, it's something you already do. Well, let's chat again soon, you know, and have a great rest of the celebration here in New York City.

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Durga Malladi: Always a pleasure, Dan. Thanks for having me.

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Daniel Newman: And thank you, everybody, for being part of the Six Five Summit here. Lots more content for you. Kicking it back to the studio or wherever you are to join us for the next session.

Disclaimer: Six Five Summit: Intelligent Edge Spotlight is for information and entertainment purposes only. Over the course of this webcast, we may talk about companies that are publicly traded, and we may even reference that fact and their equity share price, but please do not take anything that we say as a recommendation about what you should do with your investment dollars. We are not investment advisors, and we ask that you do not treat us as such.

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