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　　according to reports, people familiar with the matter revealed that Qualcomm is trying to re-enter the $28 billion server processor market, thereby reducing its dependence on the smartphone market.

　　The company is looking for customers for a product from chip startup Nuvia, which it acquired last year, sources said. Amazon AWS, one of the biggest buyers in the server chip market, has agreed to investigate Qualcomm's products.

　　Both Qualcomm and Amazon declined to comment.

　　Shares of Qualcomm rose 2.9 percent to $152.91 in U.S. stock trading following the news. Shares of companies in the chip industry have generally fallen this year. Qualcomm shares were down 19% this year through Wednesday.

　　Qualcomm CEO Cristiano Amon is trying to transform Qualcomm into a broader chip provider than just chips for smartphones. Four years ago, Qualcomm tried to enter the server market, but then chose to give up. At the time, Qualcomm was trying to placate investors by cutting costs after fighting off a hostile takeover by Broadcom.

　　Qualcomm's Nuvia started out as a technology provider for the server industry, and the company's staff included chip designers from Apple. Amon decided in 2021 to buy Nuvia for about $1.4 billion. He said at the time that Nuvia's work helped develop Qualcomm's chips for high-end smartphones and PCs.

　　Qualcomm needs to re-establish trust with potential customers if it wants to re-enter the server chip business. The server industry has also changed dramatically over the past few years. Amazon has developed its own server processors, but continues to source chips from other suppliers. Startups such as Ampere Computing have also made progress, winning contracts from big clients such as Microsoft.

　　However, Qualcomm's likely rewards are also big. A successful entry into the server chip market means Qualcomm will be able to sell more expensive products. Qualcomm's mobile phone processors typically run in the tens of dollars, but the highest-end server processors cost more than $10,000 each.

　　Last year, industry investment in cloud computing infrastructure reached $73.9 billion, up 8.8 percent from 2020, according to market research firm IDC. Companies like Amazon, Google, and Microsoft are developing these infrastructures to transfer data around the world.

　　Data center processors alone can generate $28 billion in revenue a year, according to Bloomberg Intelligence analyst Mandeep Singh. "The ARM server market is one of the bright spots in the chip industry, and re-entering this market will expand Qualcomm's market participation," he said in a Thursday research note.

　　Large cloud-computing data centers have long relied on Intel's processor technology to run their servers, but the companies are also beginning to embrace ARM processors. ARM is a key partner of Qualcomm's mobile phone processors.

　　ARM processors already dominate the smartphone market due to their low power consumption. Now, power consumption is also becoming a pressing issue in the data center industry. As the number of servers grows, servers consume more and more power, so companies want more energy-efficient chips.

　　Amazon develops its own chips based on ARM designs to meet this demand. Amazon's Graviton processors have been in development for several generations, and Amazon is introducing them to customers. Amazon is still using chips from Intel, AMD and Nvidia, though, and Qualcomm sees an opportunity to compete with those companies.

　　The last time Qualcomm attempted this was in 2018, when Qualcomm launched an ARM-based server chip, the Centriq 2400, and started foundry production through Samsung Electronics. Qualcomm said the processor is superior to Intel Xeon processors in both energy efficiency and cost. At the public introduction of server chip products in November of that year, potential customers such as Microsoft took the stage and expressed their interest in Qualcomm products.

　　However, less than a year later, Qualcomm's management decided to stop the project. Anand Chandrasekher, a former Intel executive who led the effort, also left Qualcomm.

　　For Intel, Qualcomm's latest move will bring more competition to the industry. After losing market share to companies such as AMD and Amazon, Intel is also actively developing related technologies and manufacturing capabilities.