Mobile tech conference Mobile World Congress took place in Barcelona last week, where Qualcomm (QCOM) outlined its artificial intelligence (AI) strategy and upcoming innovations.

Qualcomm CFO and COO Akash Palkhiwala joins Market Catalysts host Julie Hyman to explain what edge AI is and why Qualcomm has a competitive advantage over Nvidia (NVDA) and other names in the space.

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Edge AI being like on device AI versus cloud AI. And should people be thinking about edge AI as a complement to cloud or a replacement for? Is it an instead of or an addition to?

Yeah, yeah, if you look at really how computing has happened over the last several years, you do some computing on the phone and you do rest of the computing on the cloud. And Edge AI is no different. You're going to do some of the AI workloads on the edge and some will happen on the cloud. And it depends on what you're trying to do and where the context and the data is available. If you think about an agentic AI conversation where you want to talk to a device and get some information from it and glasses are a great example of that.

Uh, if I'm wearing a smart glass like the Meta Ray Ban, I could look at something and easily ask the question, what is this? And and the model then has to understand the question. It has to understand what the camera is looking at. And so it can feed that data into the model. And then the model will decide if the question can be answered, uh, on the edge itself or does it need to go to the cloud? And it's almost irrelevant to the user. It doesn't matter whether it happen on the edge or the cloud. It's really kind of enabling this unique use case with sensor information that is only available at the edge. And I think when you extend it from consumer use cases like this, then to enterprise use cases and then to industrial automotive, robotics use cases, Qualcomm's technology is going to be in each one of those devices and we just think we're at the very beginning of this kind of the next wave of AI innovation and it will start at the edge and continue into the cloud.

Akash, do you think that we are on the cusp of sort of a wearables revolution? I feel like we've had so many attempts at getting wearables to really catch on that have not caught on in a mass way. Is that changing now?

Yeah, I think it is changing for sure. So think about uh a device that is on your person that can see what you can see, that can hear what you can hear and you can have an agentic AI conversation with it. And so, I think glasses is how people uh understand this concept very easily. Uh but really think about it as something that's broader than glasses. It could be a watch, it could be earbuds with camera, it could be a a necklace.

But in each case, you have a device that has a camera that can uh has the same field of view that you have. It can hear the same things that you can. It will learn about your daily happenings as you go through the day and then really be able to respond to questions later in the day. I mean, one great use case uh that I've heard about recently is one of our partners in India is implementing a payment use case where you could just look at with your glasses at a QR code and say pay 100 rupees for this code. And and this is it will read the code, it will go to your e-wallet and make the payment and it's just something that will come very naturally to the user and uh I think as you bring these use cases together, we expect this revolution to take off.

I don't know in some cases I want a little more friction between myself and and making making a big purchase. But I'm sure you can build those things into. Um I'm curious about competition in this space. Obviously, Qualcomm is a leader in smartphone chips or device chips already. As you know, of course, you've got other chip makers that are getting into this. Nvidia is also in this space. Do you see Nvidia as a direct competitor in edge computing or do you think that you sort of um operate in different subsegments?

Yeah, I I think Qualcomm has very significant advantage when you think about edge computing. The one of the big factors in edge devices is that they are battery powered. And because of that, you need something, you need a chip that is really high performance at very low power. And that's Qualcomm's DNA. We've we've done that in phones. We've done that in a variety of other devices and and you know, while we do have competitors, it's an area that we've clearly been the leader in and we expect to continue to lead there. I think the technology portfolio that we have in Qualcomm is unique and one of a kind and perfectly suited for its devices. So, uh, I'm I'm very hopeful and optimistic about what we can do going forward.