Qualcomm inked a deal with SpaceX on Wednesday to provide telecommunication technology for its up-and-coming Starlink Mobile service.

The multiyear agreement, whose terms were not disclosed, came hours before the San Diego company’s fourth-quarter earnings report.

Under the deal, Qualcomm’s Dragonwing cellular infrastructure technology will power Starlink Mobile’s planned terrestrial 5G network in the U.S. With the San Diego chipmaker’s help, Elon Musk’s Starlink could become the fourth major U.S. mobile carrier, executives said, behind Verizon, AT&T and T-Mobile.

Starlink is already the largest satellite-based network.

The effort will require SpaceX to deploy Qualcomm chip technology across cellular towers nationwide, which doubles as “an opportunity to lay the foundation for AI-native 6G in the years ahead,” Qualcomm said.

Qualcomm is touting 6G as a generational step-change. More than just faster speeds, 6G will be an “AI-native” network.

Deployment is expected to begin in 2027, executives said, and Qualcomm could see revenue from the deal by the end of 2027.

After the close of markets, Qualcomm reported fourth-quarter earnings of $1.25 billion. That’s up from a loss of $3.12 billion in the same period a year ago. Revenue declined 8% to $10.3 billion.

The local chip company is trying hard to be known for more than phone chips, explained Stacy Rasgon, analyst at Bernstein. That effort is paying off, he acknowledged. Sales of chips for cars and connected devices grew 89% to $1.99 billion and 4% to $1.89 billion, respectively, year over year. Qualcomm is also moving into data centers.

But phones still make up most of what Qualcomm sells — $5.1 billion in the fourth quarter, down 26% from a year ago. And that handset business looks like it’s getting worse, Rasgon said. A shortage of memory chips is making phones more expensive to build, which is expected to hurt phone sales and, in turn, Qualcomm.

“We called June the bottom for revenues,” said Akash Palkhiwala, Qualcomm’s chief financial officer. “Since then we’ve seen revenue grow into September and December quarter, and so we are encouraged to see that we’ve been conservative in our planning and it’s playing out exactly as we’d expected.”

This year, Qualcomm has increased chip prices, signed deals with Meta, Amazon, Microsoft and now SpaceX. The company is forecasting a slight increase in revenue in the first quarter of next year.

“We are very proud,” said CEO Cristiano Amon of the SpaceX deal. “This new architecture establishes a foundation for next-generation connectivity and network intelligence. This is a significant win for our infrastructure business and the beginning of a strategic relationship with tremendous potential.”

On Thursday morning, Qualcomm stock declined more than 13% to trade at under $150 per share.

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