Qualcomm in talks to design chips for ByteDance

• Qualcomm (NASDAQ:QCOM) is in talks to provide custom chip-design services to ByteDance, the parent company of TikTok.
• The discussions could involve video processing units (VPUs) and other custom chips potentially entering mass production by year-end.
• The move reflects Qualcomm’s push to diversify beyond smartphones into AI and data center chip markets.

Qualcomm (NASDAQ:QCOM) is in discussions to provide chip-design services to ByteDance, as the company seeks to expand beyond its core smartphone business, according to people familiar with the matter.

The potential deal would make ByteDance, the owner of TikTok, an early customer of Qualcomm’s chip-design services unit, with discussions reportedly including custom video processing units based partly on AlphaWave technology.

The talks are said to involve designing custom chips such as VPUs, with some sources indicating the possibility of mass production beginning by the end of the year, although the outcome remains uncertain.

Qualcomm has been expanding its semiconductor strategy beyond smartphones into data center and AI workloads, including CPUs, inference accelerators, and custom ASIC chip development.

A successful agreement with ByteDance could help Qualcomm diversify revenue at a time when global smartphone shipments are expected to face one of their steepest declines on record.