2 weeks Ago By [email protected] (Scott Younker)
The Wall Street Journal reported late Friday that chipmaker Qualcomm reached out to competitor Intel about a potential takeover. A deal of this magnitude would be one of the most consequential tech acquisitions in quite some time, and it's believable given that Intel has been on the ropes and pacing behind its competitors over the last few years when it comes to the chip business. However, the WSJ reports that a deal is "far from certain," according to sources familiar with the matter.
Intel may or may not be receptive to the deal, which makes sense when you consider Qualcomm could tear Intel apart by selling assets or part of the company to other buyers. Based on the stock market at the time of reporting, Qualcomm is currently worth double the value of Intel and is trending up. Qualcomm is best known for making the chips that power most Android phones on the market, and its high-end Snapdragon 8 Gen 3 drives popular phones like the Samsung Galaxy S24 Ultra .
This year, Qualcomm also greatly expanded their business into Intel's realm by launching the Snapdragon X Plus and Snapdragon X Elite chips featured in new Microsoft Copilot+ PCs like the Surface Pro 11 . Qualcomm beat out Intel and AMD to have the first chips powering these new AI-forward Windows laptops, though Intel does have Lunar Lake-powered Copilot+ PCs launching this fall. Qualcomm has leaned hard into AI as well, recently hosting events at the company's Southern California headquarters highlighting how their processors add AI features in phones and computers.
Last year, the Wall Street Journal reported that Qualcomm had reached out to Intel to have the Silicon Valley company make Snapdragon chips at Intel's foundries. The effort was halted due to "technical missteps." Meanwhile, Intel appears to be falling further behind rivals like AMD and Broadcom.
In August, it was reported that Intel was going to lay off 15,000 workers in a cost-saving effort (an estimated 15% of the company's workforce) with CEO Pat Gelsinger looking to slash $10 billion in 2025. Factor in the fact that the company had posted a $1.6 billion loss in Q2 of this year, and it gets easier to imagine Intel selling to a competitor.
Avi Greengart, a consumer technology analyst and founder of Techsponential , seemed skeptical about how Qualcomm and Intel could make a deal work. "I initially assumed that the idea here was that Qualcomm would take over the client side business allowing Intel to focus on its foundry business," Greengart said in a statement to Tom's Guide. "I have absolutely no idea how the financials of that would work for either party; how could Qualcomm pay for it and how could Intel fund the foundry business without it.
" He added that because both companies are global entities, it would open them to regulatory approval everywhere, which adds additional complexities to the issue. We'll have to wait and see if any real deal materializes out of all this scuttlebutt. Stay tuned! More from Tom's Guide.
