Qualcomm CEO Cristiano Amon speaks at the COMPUTEX forum in Taipei, Taiwan, June 3, 2024.
Wang An | Reuters
Qualcomm Recent Engagements with Troubled Chipmakers Intel News of the acquisition has been confirmed by CNBC.
A person familiar with the matter, who asked not to be identified because the information is confidential, said it was unclear whether Intel had entered into dialogue with Qualcomm or what the terms of the dialogue were.
The Wall Street Journal first reported Report this matter. Intel shares initially rose before falling back to near Friday's closing price.
If the deal goes through, it would be one of the largest technology mergers ever. Intel's market capitalization exceeds $90 billion.
Intel, once the world's largest chipmaker, has been on a downward spiral for years, a decline that accelerated in 2024. The company's shares have fallen 53% this year as investors expressed doubts about the company's expensive chip manufacturing and design plans.
Qualcomm and Intel compete in multiple markets, including PC and laptop chips. However, unlike Intel, Qualcomm does not produce its own chips but relies on companies such as TSMC and Samsung for production.
On Monday, following a board meeting to discuss strategy, Intel Chief Executive Patrick Gelsinger sent a memo to employees reaffirming the company's commitment to investing heavily in its foundry business, a project that could cost $1,000 over the next five years. billion dollars. It also said it was weighing outside investment.
Intel also missed out on the artificial intelligence boom that captured Wall Street's attention. Most advanced artificial intelligence programs, such as ChatGPT, run on Nvidia graphics processors, not Intel CPUs. According to analysts, Nvidia holds more than 80% of this fast-growing market.
Qualcomm's revenue is lower than Intel's. The company reported fiscal 2023 sales of $35.8 billion, compared with Intel's $54.2 billion in the same period.
Antitrust and national security concerns would complicate a potential deal. Intel and Qualcomm both do business in China and have had deals disrupted by Chinese antitrust enforcement agencies in the past. Intel's attempt to acquire Tower Semiconductor was unsuccessful, and Qualcomm's attempt to acquire NXP Semiconductor was unsuccessful.
Other big acquisitions in the space have also fallen through. 2017, Broadcom Offered more than $100 billion to acquire Qualcomm. The Trump administration blocked the deal the following year over national security concerns because Broadcom was then headquartered in Singapore. In 2021, the FTC filed a lawsuit on antitrust grounds to prevent Nvidia from trying to acquire Arm. The deal was scrapped in 2022 amid additional pressure from European and Asian regulators.
Representatives for Qualcomm and Intel declined to comment.