2 weeks Ago
Qualcomm, the American tech company, has recently approached Intel regarding a potential takeover, according to a recent report by The Wall Street Journal. Although no official offer has been made, unnamed sources suggest that the deal remains "far from certain." The New York Times also confirmed the report on Friday evening, further confirming that Qualcomm has yet to make a formal bid.
If the takeover were to proceed and pass through regulatory scrutiny, it would represent a strategic coup for Qualcomm which has recently re-entered the desktop processor market as part of Microsoft's AI-driven PC strategy, after solidifying its dominance in mobile processors. Intel, in contrast, is at one of its lowest points in recent memory. Despite several profitable business segments, the company reported a $1.
6 billion loss earlier this year. This has led to significant shifts in strategy, major cuts, and a workforce reduction of over 15%. Intel CEO Pat Gelsinger, in response, announced the cessation of all "nonessential" work and revealed plans to spin off its chip manufacturing division - a unit that had long been a competitive strength compared to rivals like AMD and fabless chipmakers reliant on Taiwan's TSMC for production.
Adding to Intel's troubles, the company recently had to rely on TSMC to produce some of its most advanced chips, with production costs contributing heavily to its financial losses. Challenges also surfaced with Intel's in-house 18A manufacturing process, further destabilising the company's standing. While AMD, Intel's long-time rival, has faced its own struggles over the years, it managed to claw back significant market share with strong support from the gaming community.
Intel's reputation among PC gamers has also taken a hit, with recent generations of its flagship chips suffering from performance issues and crashes. Although the company has since extended warranties and rolled out fixes, its standing in the consumer market remains shaken. Moreover, Intel has lost a contract to design and fabricate the chip for Sony's upcoming PlayStation 6 to AMD.
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