Qualcomm considers Intel’s chip design units for potential acquisition

Qualcomm Inc. (NASDAQ:QCOM) is looking to expand its product portfolio Intel Corp.’s (NASDAQ: INTC) is making it expensive to buy its niche segments. Qualcomm has shown interest in several units, including Intel’s consumer PC design business, as the semiconductor giant looks to streamline its operations and boost cash flow, people familiar with the matter said.Intel is considering divestitures of various business segments as it faces a tough financial environment marked by a decline in value in the second quarter. The company’s PC client business has historically been a core part of Intel’s identity and revenue, falling 8% in revenue last year to $29.3 billion. The division is known for making the chips that power laptops and desktops worldwide.

Despite the interest, Qualcomm has yet to formally approach Intel about a buyout, and its plans are still tentative. The $184 billion market cap maker of portable chipsets, which includes Apple Inc. (NASDAQ:AAPL), is carefully weighing its options. Qualcomm’s revenue reached $35.82 billion last fiscal year, underscoring the company’s leadership position in the smartphone chip market.

Intel, meanwhile, is actively exploring ways to maintain its production goals and improve its financials. Last month, the company took radical measures to reduce its workforce by 15% and suspend dividends. Intel executives are promoting the potential of AI-powered PCs to encourage consumer upgrades and boost sales, despite the current PC market calm.

In a recent development, Intel introduced a new PC chip called Lunar Lake, made in part by Taiwan Semiconductor Manufacturing Co., a departure from traditional in-house manufacturing. The launch is consistent with Intel’s narrative that artificial intelligence applications could boost chip sales.

Intel’s board of directors will meet next week to consider proposals from CEO Pat Gelsinger and other leaders to save funds by scaling back the company’s operations, including the potential divestiture of its programmable chip division Altera.

As the situation continues to evolve, the future of Intel’s design business and Qualcomm’s expansion plans are being closely monitored by the division