The acquisition strengthens Qualcomm’s push into AI and data centers while reducing its dependence on the smartphone market.
Qualcomm has agreed to acquire AI software startup Modular in an all-stock deal valued at approximately $3.9 billion, as the chipmaker seeks to expand its presence in artificial intelligence and data center markets.
The company plans to issue up to 19.2 million shares to Modular’s shareholders as part of the transaction. Based on Qualcomm’s latest closing stock price, the deal is worth about $3.92 billion. Qualcomm shares fell roughly 4% following the announcement.
The acquisition will give Qualcomm access to software that enables AI models to run across different processors without requiring developers to rewrite code for each chip architecture. The technology is designed to improve the efficiency of AI inference workloads and could help Qualcomm compete against Nvidia, whose CUDA software platform has become a major advantage in the AI computing market.
Modular has built its business around providing a hardware-neutral software layer that supports chips from multiple vendors, including Nvidia and AMD. The approach allows customers to deploy AI applications across a range of computing environments rather than being tied to a single hardware ecosystem.
The deal comes as Qualcomm accelerates efforts to diversify beyond its core smartphone chip business, which still generates the majority of its revenue. The company has been investing heavily in AI-related technologies and plans to begin shipping processors for data centers and other AI applications later this year.
Industry analysts view the acquisition as a strategic move to strengthen Qualcomm’s software capabilities, an area increasingly seen as critical in the competition for AI infrastructure spending. By combining its hardware expertise with Modular’s software platform, Qualcomm hopes to improve the performance and flexibility of AI systems while attracting developers and enterprise customers.
The transaction is expected to close in the second half of 2026. Qualcomm is also reportedly exploring additional acquisitions in the AI sector, including discussions with AI chip startup Tenstorrent, as it seeks to establish a larger foothold in the rapidly expanding AI market.
