Qualcomm has approached fellow US chipmaker Intel in recent days about a possible takeover, the Wall Street Journal reported Friday.
Intel has suffered a string of setbacks in recent years, and a Qualcomm acquisition would be a big deal for the global chip market. The report cited people familiar with the matter, who cautioned that a takeover is far from certain at this point. The magnitude of the deal would likely be scrutinized by antitrust regulators, as it would mean fewer competitors in the PC chip space.
While Intel has been unveiling its Meteor Lake and upcoming Lunar Lake next-generation PC chips, the company has also been hit with lawsuits from consumers claiming that its Raptor Lake silicon from 2023 caused widespread computer failures.
With increasing competition from AMD, Apple and Qualcomm itself, Intel has struggled. The company suffered a blow when Apple switched to using its own in-house chips for the M-series of Mac silicon back in 2020, while AMD has taken more of the PC silicon market share with its own midrange and high-end chips. Nvidia's continued GPU dominance has pressured Intel into offering more processing muscle for high-performance tasks, like AI.
Intel, based in Santa Clara, California, has been slower to offer AI than its rivals, which have ridden the wave of artificial intelligence by offering their own cutting-edge AI-integrated solutions. Intel included some AI features in its Meteor Lake chips, but competitors like AMD's Ryzen AI mobile chips and others have been released that power Microsoft's line of Copilot Plus laptops (running the integrated AI assistant of the same name).
All of which has led to a tough financial outlook for Intel, which announced last month that it would cut $10 billion in costs, including laying off over 15,000 employees, after a disappointing second quarter. Qualcomm, on the other hand, reported positive quarterly earnings at the end of July with growth in the mobile and automotive sectors, which along with internet of things chip sales represented a diverse portfolio of products.
San Diego-based Qualcomm unveiled its Snapdragon X series chips late last year with on-device AI, which debuted in Copilot Plus-branded Surface laptops back in May. That's given Qualcomm, long known for producing mobile chips that have powered most of the world's Android phones for years, a foothold in the PC space once dominated by Intel.
Intel declined to comment. Qualcomm did not respond to a request for comment by time of publication.