SAN FRANCISCO/TAIPEI, May 19 (Reuters) - Qualcomm ( QCOM ) on

Monday said it will make custom data center central processing

units, or CPUs, that use technology from Nvidia ( NVDA ) to connect to

Nvidia's ( NVDA ) artificial intelligence chips.

Nvidia's ( NVDA ) chips are dominant in the AI market but always paired

with CPUs, a market traditionally dominated by Intel ( INTC ) and

Advanced Micro Devices ( AMD ). Nvidia ( NVDA ) has jumped into the CPU market

itself, designing a chip using technology from Arm Holdings to

develop its own "Grace" CPU.

On Monday, Qualcomm ( QCOM ) said it would return to the data center CPU

market. In the 2010s, Qualcomm ( QCOM ) began developing an Arm-based CPU

that it tested with Meta Platforms, but curtailed those efforts

amid cost cuts and legal challenges.

But after acquiring a team of ex-Apple chip designers in 2021,

Qualcomm ( QCOM ) has quietly revived those efforts, again holding

discussions with Meta about a data center CPU. Qualcomm ( QCOM ) last

week confirmed that it has a letter of understanding with Saudi

Arabian AI firm Humain to develop a custom data center CPU.

On Monday, Qualcomm ( QCOM ) said that its future chips would use

technology from Nvidia ( NVDA ) that will help them communicate quickly

with Nvidia's ( NVDA ) graphics processors (GPUs), which are the mainstay

of its AI chip portfolio.

"With the ability to connect our custom processors to

Nvidia's ( NVDA ) rack-scale architecture, we're advancing a shared

vision of high-performance energy-efficient computing to the

data center," Cristiano Amon said on Monday.