Qualcomm Inc. reached a deal with TikTok owner ByteDance Ltd. to supply chips for the latter’s artificial intelligence data centers. QCOM stock climbed over 4% on the news, further pushing its massive 67% climb in the last 30 days. Qualcomm’s agreement to supply AI chips to ByteDance marks a significant expansion into the AI infrastructure market, driving investor enthusiasm behind the semiconductor developer.

The TikTok owner is set to procure millions of Qualcomm application-specific integrated circuits, or ASICs, which are expected to support ByteDance’s AI agent software. The agreement may also give Qualcomm one of its first major customers for its AI-focused ASICs, after CEO Cristiano Amon said during the company’s Q2 2026 earnings call last month that Qualcomm had engagement with several companies, without identifying them. Investors reacted quickly to the report, pushing Qualcomm shares up as much as 8.3% to a new intraday record.

ByteDance’s dual approach of buying commercial supply while developing proprietary chip IP mirrors the hyperscaler playbook, meaning US chip vendors will increasingly compete against their own customers’ in-house silicon. For AI infrastructure leaders, this deal signals the custom ASIC market for data centers is expanding beyond Nvidia’s GPU dominance, with foundry-plus-supply bundles becoming a viable commercial model.

Further, Qualcomm (QCOM) is continuing its rally from last week, following an investment boost to the quantum sector from the Trump administration worth nearly $2B. Qualcomm was one of seven companies to receive $100M in investment, with IBM receiving $1B in exchange for a government equity stake. The Trump administration’s investment is part of a broader push to ‌shore up the domestic supply chain and counter China in crucial sectors. The quantum computing industry is growing exceedingly crucial in that effort, in tandem with the AI sector.

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The ByteDance announcement is positive for Qualcomm QCOM shares as it provides definitive proof that the company can successfully scale its business outside of mobile processors. However, investors on the street remain cautious about the stock. Based on 31 Wall Street analysts offering 12-month price targets for Qualcomm in the last 3 months. The average price target is $178.57, with a high forecast of $300.00 and a low forecast of $100.00. That is a 28% decline from the current price of $248.82.