Qualcomm Considers Acquiring Intel’s PC Design Unit Amid Intel’s Financial Struggles
As Intel seeks to reduce costs and streamline operations, Qualcomm is considering acquiring key design divisions to expand its market share
Qualcomm is considering acquiring elements of Intel's design business to boost its product capabilities, according to sources familiar with the situation. The move comes as Intel strives to eliminate business units and streamline operations amid continued financial difficulties. While Qualcomm has not made a formal approach, it is interested in Intel's client PC design business, which coincides with Qualcomm's long-term growth goal.
According to sources, Qualcomm is considering purchasing several design units from Intel, particularly its client PC division, which builds chips for laptops and desktops. Qualcomm officials are particularly interested in this category since it has the potential to increase the company's foothold in the PC market. Other areas, such as Intel's server business, are not considered potential acquisition targets given Qualcomm's focus on mobile and PC technology. Despite continuous negotiations, no final decisions have been taken, leaving the situation fluid.
Intel, which just reported a sharp drop in revenue and halted dividend payments, is under pressure to earn cash while still funding its manufacturing projects. The company's PC client business, which was once a bedrock of its success, witnessed an 8 per cent drop in revenue last year, adding to Intel's overall financial troubles.
While Intel remains committed to its PC business, as evidenced by the recent Lunar Lake chip release, the company is considering strategic options, including the sale of Altera, its programmable chip division. Qualcomm's possible purchase intentions mirror its broader desire to expand beyond mobile processors into the booming PC and AI businesses.
Qualcomm, worth USD 184 billion, has been working behind the scenes for months on plans to acquire parts of Intel's business. The acquisition would supplement Qualcomm's current product portfolio, which produced USD 35.82 billion in sales last year.
Meanwhile, Intel is facing enormous issues following a terrible second quarter and an 8 per cent drop in revenue from its PC division. As Intel executives, led by CEO Pat Gelsinger, look for ways to reduce operations, asset sales may be on the horizon to protect cash flow and promote future innovation.
