Qualcomm CEO Cristiano Amon speaks at COMPUTEX forum in Taipei, Taiwan June 3, 2024.
Ann Wang | Reuters
Qualcomm approached Intel about a takeover in recent days, the Wall Street Journal reported on Friday, citing people familiar with the matter.
Intel shares rose 8% on the report.
The deal, if it were to happen, would be one of the largest technology mergers ever. Intel has a market cap of around $96 billion.
It would cap off a dire stretch for Intel. The company’s stock had its biggest one-day drop in over 50 years in August after the firm reported disappointing earnings. Intel stock is down 53% in 2024 as investors express doubts about its costly plans to manufacture and design chips.
Qualcomm and Intel compete in several markets, including for PC and laptop chips. However, Qualcomm, unlike Intel, does not manufacture its own chips, and instead relies on firms like Taiwan Semiconductor Manufacturing Company and Samsung to handle production.
On Monday, after a board meeting to discuss strategy, Intel CEO Patrick Gelsinger sent a memo to staff that reiterated the company’s commitment to investing heavily in its foundry business, a project that could cost $100 billion over the next five years. It also said that it was weighing outside investment.
Intel has also missed out on the AI boom that has captured the attention of the technology industry. Most of the advanced AI programs, such as ChatGPT, run on Nvidia graphics processors, instead of Intel central processors.
Qualcomm has less revenue than Intel, reporting $35.8 billion in sales in its fiscal 2023, versus $54.2 billion for Intel.
A representative for Qualcomm didn’t immediately respond to a request for comment. Intel declined to comment.
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