Qualcomm and Intel Discuss Potential Big Deal
New Delhi [India], September 21: Qualcomm, a major chipmaker from San Diego, is in talks with its rival Intel about a possible acquisition, according to recent reports. Although no formal offer has been made, discussions have taken place, highlighting the possibility of a landmark deal between two of the largest chipmakers in the world.
The talks are confidential, and the likelihood of a deal remains uncertain due to regulatory challenges and the complexity of Intel’s operations. Qualcomm has not yet made an official offer for Intel, and the obstacles to a deal remain steep. Any deal would likely draw significant regulatory scrutiny, given the size and national security importance of both companies.
Intel, once a dominant force in the semiconductor industry, has faced significant setbacks in recent years. Management issues and missed technological transitions, including its failure to capitalize on the rise of mobile chips and artificial intelligence (AI), have left the company trailing behind competitors like Nvidia and Taiwan Semiconductor Manufacturing Company. Intel’s manufacturing capabilities, once considered the most advanced, have also lost ground to rivals.
In August, Intel reported a USD 1.6 billion quarterly loss and announced plans to cut 15,000 jobs. The company is also pausing new plant setups in Germany and Poland, despite being the largest recipient of federal financing under the CHIPS Act.
Qualcomm, which specializes in cellular technology and provides chips for major smartphone makers like Apple and Samsung, has seen its stock rise by 55 per cent recently, giving it a market value of USD 169 billion. Intel, whose shares have fallen by nearly 40 per cent, is currently valued at USD 93 billion. A deal between the two would likely be costly and face intense regulatory scrutiny due to their size and strategic importance to U.S. national security.
Industry experts suggest that Qualcomm may be more interested in acquiring Intel’s chip design operations and expertise in PC software, rather than its foundry business, which manufactures chips. Given Qualcomm’s history of outsourcing production, it remains uncertain whether the company would want to take on Intel’s manufacturing arm.
Both Qualcomm and Intel declined to comment on the reports. However, if Qualcomm’s bid progresses, it could signal a significant shift in the semiconductor landscape, with potential implications for the global chip market and U.S. technological competitiveness.
Doubts Revealed
Qualcomm -: Qualcomm is a big company that makes tiny parts called chips for phones and other gadgets. They are based in San Diego, a city in the USA.
Intel -: Intel is another big company that also makes chips, but they are more famous for making chips for computers. They are rivals with Qualcomm.
acquisition -: An acquisition is when one company buys another company. It’s like when you buy a toy from a shop, but here, a company is buying another company.
regulatory scrutiny -: Regulatory scrutiny means that the government will check very carefully if the deal is fair and follows all the rules. It’s like when your teacher checks your homework to make sure it’s done right.
stock -: Stock is a small part of a company that people can buy. If the company does well, the value of the stock goes up, and if it does badly, the value goes down.
chip design -: Chip design is the process of creating the tiny parts that go inside electronic devices like phones and computers. It’s like drawing a blueprint for a building, but much smaller.
PC software -: PC software is the programs and applications that run on personal computers. It’s like the games and apps you use on your computer.
