The AI Agent in Your Pocket: Qualcomm’s CEO on the Future of Mobile

0:03Cristiano Amon:This week on Bold Names, we're talking to Cristiano Amon. He's the CEO of Qualcomm. The tech giant's claim to fame is that it powers the device many of us can't live without, the smartphone. When you touch your smartphone, you have a piece of Qualcomm technology. Now Cristiano is looking to a future dominated by our relationship with artificial intelligence. So what does that look like? That's next. From the Wall Street Journal, I'm Tim Higgins. This is Bold Names, where you'll hear from the leaders of the bold name companies featured in the Wall Street Journal. Today we ask, how are we actually going to interact with artificial intelligence?

0:46Cristiano Amon:Cristiano, thanks for joining Bold Names. So excited to have you here. Your company provides the guts to many of the most popular digital devices out there. I think if we were 100 years ago, it would be like you're selling the engines to Henry Ford himself. On top of that, your company is working with the leading tech companies that are developing artificial intelligent devices, really the physical manifestation of how we're going to interact with AI. Your chips are in Meta's smart glasses. This perch you have allows you to see the trends, where things are going in the industry. And so I'm curious, what does the near future look like when it comes to AI devices?

1:26Cristiano Amon:What do you expect this year, next year? How's the world changing? All right. That's a loaded question, Tim. So we're going to have to unpack that. You know, we're the company doing the chips that the humans use, and AI is changing everything. It's going to fundamentally change computers and computing in general. You know, I like to think about it. AI is just a different way that you're going to be doing software in architecture and computing and how we interact with computers. And I think that's probably the foundation to understand what's going to happen with all those devices. And let me just start with a very basic concept that I think we've been talking for a couple of years.

2:08Actually, we started talking about this before it was popular. I think we should have trademarked the terminology that AI is the new UI. going forward. The computer now understand us. So we don't have to learn how to interact the computer device. What we say, what we see, all of those things are going to be understood by the computer. That's going to change the computer, the OS, the application. You were starting to -

2:36Cristiano Amon:It's going to change how you interact with this digital world, right? Right now, you go onto your smartphone. If you want to interact with AI, you go to whatever app you like and it goes off to the cloud and sends you an answer. That's kind of the world. But you're seeing it something much different now is what you're talking about. Yes. And let's just start with mobile devices because it's probably the largest consumer electronic product. It's actually the largest platform ever created by Minkon. So it's a big driver for you, big revenue. Your biggest revenue driver, right? Mobile phones, right?

3:06Cristiano Amon:Smart phones. We are working hard to diversify, but we love mobile. We're always going to love mobile. Well, let's keep going down this thought process. So now, one of the things you're starting to see is the emergence of new type of mobile devices. We call them personal AI devices. One example of that is the glasses. I think you mentioned about the meta glass. So glasses is very natural because, first of all, I think you and I have been using glasses. I think humans use glasses. They're not going to walk around with big helmets, but they will be using glasses like this. It's close to our senses.

3:41It's close to our eyes, to our mouth, to our ears. When you turn your head, whatever you're looking, if you have a camera on it, the model is looking. And we're starting to see those new type of computer-human interactions with pure agentic applications. Because if you have an agent now that is working with a large language model or multiple large language models, and all of a sudden the agent understands your intentions and is connected to the Internet, then he can do anything. He replaces the app. And he's going to replace some of the workloads. And let me give you some example. I'm going to make this very practical for you.

4:20Cristiano Amon:Yeah, please. So let's say, for example, I like to provide this example of banking because all of us have, you know, a banking app. So you go today, you think about this banking app, you pick up your phone, you click on the icon. Here's Tim's checkings account. Here's Tim's balance. I'm sure there's a ton of money over there. He's all his old names pays very well. Yes. Who was his last few transactions? Right. And you're going to this thing. You're going to have your smart glasses and you're going to see something you want to buy. And you just ask the model, I'd like to buy this. I probably want to use the money I have on my check ins account.

4:59How much do I have on my check ins account? And the model will have your credentials like you gave your credentials to the happen, we'll say, this is how much you have. What was the last five transactions? Did that check, you know, got deposited? Say, yes, it did. Can you buy this for me? You're going to get a bill. You're going to look at the bill, say, pay this for me. Please notify me when I'm done. It's going to completely change how we think about banking. And this is going to go everywhere. It's going to be like, call me an Uber, make a reservation in this restaurant. And it's going to also change how we interact.

5:29For example, we're starting to see some great use cases with Matt is doing on glasses, you can be on a WhatsApp call, you start broadcasting that call. How you think about social media, it's like I'm walking with my buddy, and I say, oh, who's this person over there? Let me check. Oh, it's Tim. You want me to say hi to him? So that's how mobile devices are going to change. We're just the beginning of the transformation, and just on those personal devices.

5:55Cristiano Amon:Yeah, I guess I'm curious. You're bullish on glasses, because really good-looking people tend to wear glasses. I think you and I agree with that, right? I 100 % agree with that. Absolutely. But you think there are other form factors out there. What are you bullish on other than glasses? Yes. So we've seen a couple of form factors. We see glasses. We see earbuds. We've seen jewelry. I think humans, you know, been wearing jewelry and pens or something like that on the lapel or something. Pin, pendants. We've seen watches. I think that's exciting. And those things going to work alongside your phone.

6:31Your phone is going to have like a dual role. It's going to keep doing phone things and it will be doing all of the processing and having a front end of AI in some of those applications. And it's kind of no different than what we've seen before, Tim. I remember in the early days of the smartphone, we all used to do e-commerce on our laptop. Not anymore. Most of the world right now do e-commerce, buy things on Amazon, for example, in the United States, on their phone. This is what's going to happen. You're going to have those new devices and you're going to start naturally doing things on those new devices.

7:03And that's how the mobile ecosystem is going to evolve.

7:07Cristiano Amon:So maybe the death of the smartphone has been exaggerated. Still, Cristiano says AI will change those devices and our relationship with them in the future. That's where the value of the ecosystem is going to be. It's not the OS, It's not the app store. It's going to change. And I think we've seen those generations of wireless industry, how those things have changed. Stay with us.

7:42Cristiano Amon:You seem to remain bullish on the phone. It's not going away anytime soon. And I think some in tech see AI and the kind of the personalization that it allows and kind of the new ability for different kind of apps and kind of new ecosystems to emerge as an opportunity to displace some of the smartphone makers, right? Let me elaborate on that because, if anything, I think we have a little bit of experience with the mobile industry. A few years of it, huh? And we have seen, I hate to say it that way, but we have seen like a big list of companies that went from hero to zero. Like we've seen many of those.

8:24And especially because you have big technology transitions. So companies can change. I think the players can change. I think the companies that actually capture value can change. Not necessarily, I think, the device can change. Let me walk you to some practical examples of that. When the laptop was invented, everybody said the desktop is dead. Desktop's not dead. Not dead.

8:48Cristiano Amon:I wrote a few of those stories, I think. But it changed. It became a workstation. It became a gaming PC. You can see a lot of desktops in hospitality. You see, it became a different, it dedicated to a particular use case. Then when we started with the smartphone, a lot of people said the laptop is dead. It's not dead. So I think the phone is not going to go anywhere. But some of the things you do with your phone, you're not going to do with your phone. You're going to do somewhere else. And here's a hint for you. Whoever has the ability to understand the human intention has the opportunity to be a winner and capture the most value.

9:32For example, if in the future the assistant on your phone becomes incredibly useful because it's the agent that you chose to interact with, and maybe there's going to be multiple agents. Once the agent understands what Tim wants, whether it's going to go somewhere, tell me about my calendar, call somebody, pay something. when the agent understands the value on that transaction is in the understanding of the human intention. And then the agent is free to go to the Internet, to go to different apps and do everything. So that information, that's where the value of the ecosystem is going to be. It's not the OS.

10:17It's not the App Store. It's going to change. And I think we've seen those generations of wireless industry, how those things have changed. So I think we're going to see change again. We don't know where they are, but it's just it doesn't mean the phone is going to disappear.

10:32Cristiano Amon:So you're talking about a world where these devices are picking up all sorts of personal information about the user, and then they can use that information to help them navigate their life, right? I think there's some concern that all that data going into the cloud could be surveillance state or it could be a privacy issue. What's your kind of what's your thought on that? Well, that's the reason they're companies like Qualcomm. Look, a lot of the things that we do is really what we call on the edge. Let's unpack that a little bit. What do you mean by edge? Edge computing, right? Yes. Edge now is a term that has been used for everything that is outside the data center.

11:11Cristiano Amon:So it happens on your device. Yes, exactly. It's the processor in your phone, in your PC, in your car. So what's happening, this is actually a good opportunity to talk about an interesting discussion that is happening now with AI. There's often this debate about where are you going to do the processing? Is there going to do the processing in the cloud? Are you going to do the processing on the edge, which means on your device? Which one is better? Which one's going to win? And I think that's the wrong way to ask the question. And I go back to our smartphones today. Our smartphone today has a lot of processing power.

11:51Every time we buy a new phone, we want a faster processor. It is the most cloud-connected device. If you put on airplane mode, you're going to be very frustrated with your device. And you don't talk about it, what's on a device, what's on the cloud. I think that's what the future is going to be with AI. AI is going to be, there are certain things you're going to do on the device, there are certain things you're going to do on the cloud, and it's simply going to go to work. But that, what you said before, is a very important question. When you think about agents, context is really important. You know, this is Tim.

12:22I know about Tim. I know where Tim is right now. So when he asks me a question, I have to have that context. Otherwise, I'm not very useful for Tim. Like, especially if this is an agent. He knows when you're at work or you're home, it's like you're talking with another human. So that context is very important. So we're developing chips, for example, for what we call ambient AI, perception AI. Those things run on your device, provide an analysis of the context on your device, and inform the agent on your device. And it's really going to be the control of the user, whether he wanted to send those things to the cloud or not.

13:04But I think we're going to see that happening in the near future. you're going to have processors that's done on a device with the intent of actually having the ability to give you that context. When I think of Qualcomm, I think of those chips that you make

13:20Cristiano Amon:that are so efficient, which is why they're so needed or so desired for smartphones, because they don't have a lot of batteries. You want it to be able to last all day. That's why I'm a little surprised that increasingly we're hearing talk and you talk about your role in data centers, right? So much attention of AI out there in the world is money going into these data centers. That's how AI is trained. That's how it operates. Lots of money going to NVIDIA for their chips. Where do you see your spot there to compete in the data center realm? Yes. You know, if you actually go type in on a Google search box on the chat to BT, I think, or Gemini, ask the question, you put it in on the search, data center and energy.

14:10And you're going to find a lot of news about that there's a massive projection of growth of data center.

14:17Cristiano Amon:Because they suck up so much energy, those data centers, right? They just require just a lot of electricity. Elon Musk, he wants to take data centers to the outer space because of solar power up there. Or you hear all these other folks talking about having nuclear reactors to keep their data centers humming. So, yeah, they suck up a lot of juice, right? So that's what you're going to see. People are going to basically say, this is the projection of what we need in computing with a data center. This is the availability of energy. There's a disconnect. Right, huge disconnect. So that's where Qualcomm could be an interesting player there because our DNA comes from a battery-powered device.

14:58We have to design chips. They're very efficient in power. And I know we spend a lot of time talking about phone. I like to provide this example. From an engineering standpoint, the phone is super challenging because you have GPUs that can do ray tracing games. You have neural processing units doing multi-billion parameters AI at the same time. Now you blast gigabit of data speed to the base station. All of those things that happen, the device has to fit in your pocket, cannot get hot, cannot get hot. You're going to touch your face with that device, and the battery has to last all day. It doesn't matter how much computing power.

15:40As engineers, we'll get a budget that the battery is going to be this size and has to last all day. So that forces the development of very power-efficient computing. We become successful because we have this computer density with low power, and why not take that to the data centers?

15:55Cristiano Amon:So you see the limiting factor that there's not enough electricity out in the world for all these data centers is really the place for you to come in and find your own swim lane and to compete. 100%. Which is interesting because we are seeing just so much attention going on to these data centers, right? The demand for AI computing power is also creating a shortage of memory for smartphones, right? And you've warned that's going to hinder your business. What's happening there? It's interesting because we're kind of one of the few companies that started talking about this. But given the scale phone, phone is a little bit of the canary in the coal mine.

16:35But here's what's happening. There's this massive build out on data center. And the existing solutions today are using this memory called HBM, which is high bandwidth memory for data centers. So a lot of the memory companies today, they had prioritized the build out of using their factory capacities to build HBM for the data center. There was this much memory capacity in the world, as a lot of those go to the data center, whatever was left became available for consumer electronics. And you see memory in the consumer electronic devices in two ways. You have your DRAM. That's when you buy a phone and a PC how much memory is going to have, 8 gigabytes, 16 gigabytes.

17:17And then you have your storage, which is like Flash or NAND. And what we saw is the amount of memory that was available to the consumer electronic devices are now less than it was available last year. So I think what I just said in the last earnings call, until the situation resolves, memory will define the size of the market. And I think we've seen that impacted in phones. And what's kind of interesting, because we just had a record quarter in the 40 years of the company. We have the record revenue quarter for the company, revenue record in mobile. Demand is high. People want to buy new phones, but it's just going to be defined by the availability of memory.

18:03Phones are not immune to this. PCs are not immune to this. Gaming consoles are not immune to this. Everything that is consumer electronic is going to be fighting for memory with this data center build-out.

18:14Cristiano Amon:Just ahead, Qualcomm survived the last big tech boom and bust cycle. How is that informing Cristiano's strategy to navigate today's AI market? If you go back at that time, the winners of social, it wasn't very clear. It wasn't MySpace, it was Facebook, it was Instagram. It wasn't MapQuest that won the MapSpace, it's Google Maps. That's next.

18:55Cristiano Amon:It's frothy out there, right? Do you see any parallels, what's going on around the excitement, the boom around AI with kind of the last big boom and then bust of the dot-com era 25 years ago? So I think the first comparison between the two, if you go back to the year 2000 and you look how people imagined at the time what the internet would be, and you look right now in 2026, 26 years later, we can probably say without any doubt, the internet today is way bigger than people thought internet will be in 2000. Whatever they thought in 2000, they were not thinking big enough. It's bigger today. Now, did that happen all in one year?

19:41No, it did not. It went to a process to get to that. So I think it's the same with AI. As I said before, AI is kind of this new form of computing. It's going to change everything, probably in the long run, bigger than what people think it is today. How fast do we get there? And are we going to keep going at that speed? Are we going to accelerate? Are we going to take a pause? It's really hard to predict. The other thing that is interesting when you make those comparisons, in back then, and I know this is going to show my age, right? I've been doing this for a while.

20:15Cristiano Amon:You've been at the company since, what, 1995? You started as an engineer. I joined as an engineer in 1995, been at the company for 30 years. Actually, it's going to be 31, 2026. But if you go back at that time, the winners of social, it wasn't very clear. It wasn't MySpace. It was Facebook. It was Instagram. It wasn't MapQuest that won the MapSpace. It was Google Maps. So we'll see what happens. I think we're in the very early days. Now, it is true that AI is a revolutionary technology, and it's probably only going to get bigger. Now, let me give you now a different perspective. You have all this money going to creation of AI, but eventually people want to make money on it.

21:03You're going to have to have a return on all the investment. And that's when you move from training to what we call inferencing. Inferencing is actually once you already develop the AI and you start asking questions and the AI start answering your questions or doing things for you and generate tokens, that's called inferencing. You just now put the AI into production. Training you created an AI, inference you put into production, that's where you're going to get paid. So when you start operating the computing with inference, the metrics are very, very different than the ones you use for training.

21:37How much money does it cost me to operate this compute? What is my total cost of ownership? How much power do I use? How much does this computer cost? How much is the architecture of memory? And we said, I think before it was popular, that the architecture for the future of inference is probably going to be the post-GPU architecture, where the data center is going to get disaggregated into different functions, and you're going to try to find the most efficient computer to do that because now you're in the business of operating that compute. And I think that's going to be probably the next cycle.

22:13We're about to enter the cycle of inferencing in the data center, and the opportunities in the players may be a little bit different.