Report: Qualcomm to Exit Server Chip Market

Back in early November last year, Qualcomm announced the world's first 10nm server processor family called the Centriq 2400. It was the culmination of four years "intense design, development and ecosystem enablement effort." However, less than seven months on, Qualcomm's presence in the datacenter looks set to end.

As Bloomberg reports, Qualcomm is thought to be planning an exit from the server chip market. Two options are being considered: shut down the server chip division of the company, or sell the division for someone else to take on and continue developer ARM-based server chips for the datacenter.

For now, Qualcomm isn't commenting, but seven month is not that long to decide whether a market is viable. That may be a sign of Intel's dominance, but only last month Qualcomm's CEO, Steve Mollenkopf, stated in the company's earnings report that spending was set to be reduced in "non-core product areas." Server chips clearly counts as one of those areas.

In the short term, dropping server chip research and development will save Qualcomm money. However, as more services move into the cloud, datacenters become ever more important. The server chip market can only grow in the coming years, while Qualcomm's core market of chips for smartphones seems to be slowing down.

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