This is information that would have made people smile a few weeks ago, but is no longer entirely improbable today. According to information from the Wall Street Journal, Qualcomm has made an approach to consider a takeover of Intel. How did this happen? The current turbulence is largely due to the company’s plummeting stock market value. Since the beginning of this year, Intel, once the world’s most valuable tech company, has seen its share price plummet by almost 60%.
But let’s get back to reality. The news reports of the last few hours speak of “approaches”. So we’re a long way from a deal. This information also comes on the heels of Intel’s proposed plan to reduce the weight of its losses caused by its massive investments to regain leadership in chip production. One direction would be to separate Intel’s Foundry business and open up its capital for two reasons. Firstly, to spread the burden of investment. Secondly, to make this entity autonomous, in order to attract customers who are reluctant to invest in it because they are also competitors of Intel chips. Where does Qualcomm stand in all this?
Qualcomm towards an Intel takeover… Really?
It’s hard to say, but we’ve known for some time that the company also has its sights set on the PC market, and has proclaimed this loud and clear. From this point of view, Intel’s expertise in chip design is indisputable. Recent releases from team blue ( Lunar Lake springs to mind) demonstrate the company’s indisputable expertise, and one might even wonder whether it isn’t manufacturing that has handicapped Intel in recent years. Then there’s the manufacturing / foundry part . This part of the company has undergone massive investment to bring itself up to speed, at the cost of the turbulence we are experiencing today.
It’s hard to read a crystal ball at the moment, but an outright takeover seems highly unlikely on the basis of the information we have. It would involve the same kind of constraints as those faced by Nvidia when the deal with ARM was envisaged (respect for competition, possible dismantling, length of the operation…)
If this feeling is shared by both parties, it would mean that only a sale of part of the company could tick all the boxes. The chip design part, as Qualcomm recently shed several teams, or the manufacturing part? The second hypothesis seems the easiest to imagine. It would open the door for Qualcomm, another major American player, to take control of the capital of an independent foundry with a strong US presence. Selling off the chip design business would certainly provide a credible guarantee of the independence of Intel’s foundries… but it would not solve the problem of investment losses, which will have to be digested for a few more years…
In short, the uncertainty is still there, but let’s remain cautious. These information leaks are rarely spontaneous, and are primarily aimed at the stock market.
