2024-09-21 22:40:08
Will there be a mega deal between the chip giants? Apparently Qualcomm is showing interest in a competitor.
The shares of the struggling chip company Intel have risen in price following a report that rival Qualcomm is interested in buying the company. The stock rose by more than three percent in US trading. At one point, the increase was even greater, at over nine percent. The Wall Street Journal wrote on Friday that Qualcomm had approached Intel with a takeover proposal. Intel did not want to comment on the report, and Qualcomm did not initially respond.
Intel is struggling with high losses. The former industry leader plays practically no role in the smartphone business – and Intel has so far been unable to really compete with its competitor Nvidia when it comes to new chips for applications with artificial intelligence. In addition, Intel is also coming under increasing pressure in the PC market and with chips for data centers. The company has to save money and a few days ago postponed the construction of a chip factory in Magdeburg by an estimated two years.
Companies could complement each other well
Qualcomm is particularly strong in modems and processors for smartphones – and is also currently making inroads into the PC market. Industry analyst Patrick Moorhead of Moore Insights told CNBC that he could certainly see how the two companies’ businesses could complement each other well. There is hardly any overlap between Intel and Qualcomm’s business areas and technical platforms. However, a deal would likely trigger a thorough review by competition authorities.
Intel’s market value has fallen by more than 50 percent since the end of 2023. Qualcomm was recently worth about twice as much after a share price increase of around a fifth this year. According to the report in the Wall Street Journal, Qualcomm shares closed down almost three percent.