Qualcomm wants to buy Intel, will the semiconductor industry be shaken?

Qualcomm President Cristiano Amon speaks at the Mobile World Congress (MWC) in February 2024 - Photo: AFP

According to the Wall Street Journal on July 20 (local time), chip maker Qualcomm has made a move to buy competitor Intel in the past few days.

The most influential deal in technology history

The value of Qualcomm's offer has not been disclosed. However, given the two companies' positions in the chip market, this could be the largest merger and acquisition (M&A) deal in years and the most influential in the history of the world's technology industry.

Qualcomm is now the leading supplier of chips for smartphones, with a market capitalization hovering around $188 billion.

Qualcomm's most famous products include the renowned Snapdragon smartphone processor family and 4G/5G telecommunications modem lines.

Qualcomm's telecom modems are so advanced that they are not only found in Android phones but are also used in iPhones.

Despite possessing the world's leading chip design capabilities, Apple has yet to develop its own telecommunications modem products that can compete with Qualcomm and must depend on this partner.

Meanwhile, Intel is still the leading supplier of personal computer and server processors (CPUs). Intel's name is famous through generations of CPUs Pentium, Core i and now Core Ultra.

At its peak, Intel was the world’s most valuable chip company for many years. In 2020, the company was valued at over $290 billion.

On the business side, the merger of Intel and Qualcomm would bring two leading chipmakers for mobile devices and personal computers under one roof, providing more resources for both sides.

But the potential impact of the deal is not just economic. In an increasingly politicized chip industry, Intel and Qualcomm are seen as America’s “vanguards” in the semiconductor race.

Intel has not yet responded to Qualcomm's purchase offer, so it is not yet possible to confirm the feasibility of the above deal.

Even if the two sides reach a merger agreement, the deal will certainly be "whistled" by antitrust authorities. The scale and influence of Intel and Qualcomm are too large, and the two "giants" coming together under one roof could completely shake up the world market.

Serious Crisis at Intel

Chip company Intel is in the most serious crisis in its history - Photo: AFP

Intel is going through the worst years in its history. Business difficulties have caused Intel's value to plummet, now only about $90 billion. In 2024 alone, the company's stock value has fallen by 60%.

In the second quarter of 2024, Intel reported a loss of $1.6 billion. This business result is far worse than the same period in 2023, when the company made a profit of $1.5 billion.

In August, the group's CEO Patrick Gelsinger had to propose a roadmap to cut costs by up to more than $10 billion by 2025. Some solutions include laying off thousands of employees and stopping paying a portion of dividends.

Intel is currently pursuing a path to separate its chip design and chip manufacturing divisions. Of these, the chip manufacturing division for partners is Mr. Gelsinger's big ambition, as Intel plans to spend hundreds of billions of dollars to build more factories in the US, Europe and Israel in the past few years.

However, chip processing work has not been really favorable when partners are not very interested.

Source: https://tuoitre.vn/qualcomm-muon-mua-intel-nganh-ban-dan-lieu-co-chao-dao-20240921122709819.htm