According to a new report, Qualcomm is interested in acquiring Intel and has approached Intel about a possible acquisition, which would make Qualcomm an even bigger player in the industry than it is now. Details of the interest in acquiring Intel came from The Wall Street Journal (via The Verge and Yahoo! Finance), which cited anonymous sources. According to the report, the deal is not a sure thing and Intel has not agreed to any such proposals at this time.
It is also unclear whether Intel would be interested in the acquisition. It would certainly be a big deal for both companies. Intel shares recently closed up 3.3% but have struggled recently due to issues with the company’s last two generations of chips that caused the chips to crash. Intel also recently announced that it would cut at least 15% of its workforce as of last month. Meanwhile, Qualcomm’s shares recently fell 2.9%. Buying Intel and its chip designs could help the company re-enter the PC chip market.
Intel recently announced that it would spin off its foundry business into a standalone company, just two days after it was reported that the company was seeking government assistance to convince U.S. companies like Apple and Nvidia to use Intel’s manufacturing for making AI-based chips.
Qualcomm’s acquisition of Intel will likely require regulatory approval.
Qualcomm buying Intel would be a big deal. Even if it benefits both companies, regulators may see it as giving Qualcomm too much power in the industry. Even if Intel agrees, it’s a deal that would likely attract the attention of the FTC due to antitrust concerns. That said, it’s also an American-owned company buying an American-owned company, so it’s not necessarily a lost cause in terms of approval.
But Microsoft’s acquisition of Activision Blizzard was also between two American-owned companies. It still drew a lot of attention and backlash from regulators. And that’s all assuming things get that far for Qualcomm and Intel. At this point, all we know is that Qualcomm is interested, and has approached Intel about that interest.
News of the proposed acquisition comes just weeks after Qualcomm reportedly expressed interest in buying parts of Intel’s chip business, specifically its chip-design division. Intel has reportedly been looking to downsize and sell parts of its business to conserve cash. The company’s shares have fallen about 57 percent so far this year.
Qualcomm recently laid off hundreds of employees.
Reports that Qualcomm is interested in buying Intel come on the heels of the company recently announcing hundreds of employee layoffs. The company said it plans to lay off about 226 employees later this year, affecting employees at 16 facilities in the San Diego area.
This doesn’t necessarily have anything to do with Qualcomm’s interest in buying Intel, but it’s a move Qualcomm is making that could help the company conserve some cash — cash that could be extremely useful in an Intel deal if things go forward.