Qualcomm Backs off Intel Deal After Arm’s Rejected Bid for Product Division
Qualcomm has backed off pursuing an acquisition of Intel with reports that the company's complexities has made the deal less attractive. | Credit: Shauna Clinton / Getty Images.
- U.S. tech giant Qualcomm has moved away from its potential purchase of Intel.
- The deal would have marked one of the largest technology deals in history.
- British chip manufacturer had its bid to buy part of Intel rejected.
Qualcomm has backed off pursuing an acquisition of Intel after the company’s complexities made the deal less attractive, according to Bloomberg , citing people familiar with the matter.
The move comes after Intel blocked British chip manufacturer Arm’s advances to purchase its product division.
A cooling in deal offers marks a blow to Intel, which has been looking to turn its business around with new strategies and major cuts.
Qualcomm Backs Off
After Qualcomm made its first move to take over Intel in September, Bloomberg reports that the company realized it would face several operational, regulatory, and financial hurdles if it continued.
The difficulties also came from Intel’s fledgling performance, including its debt totaling over $50 billion.
An acquisition of the company would likely have faced an in-depth antitrust review in the U.S. and China, Intel’s key markets.
Qualcomm would also have had to head up Intel’s fledgling semiconductor manufacturing unit, an area in which the company has never operated.
The potential acquisition from Qualcomm came in September after Intel posted a net loss of $1.6 billion in its Q2 financial report.
Pat Gelsinger, Intel CEO, used the results to send a memo to its workforce, claiming it was launching “significant actions to reduce our costs.”
The company aimed “to deliver $10 billion in cost savings in 2025, and this includes reducing our headcount by roughly 15,000 roles, or 15 percent of our workforce.”
What Would a Qualcomm-Intel Merger Look Like?
A merger between Intel and Qualcomm would have been one of the most monumental events in the tech industry, blending two giants with distinct but overlapping strengths.
This would have positioned the two companies as leaders across computing platforms, from PCs to IoT devices.
Intel could have leveraged Qualcomm’s patents in mobile chipsets to expand its presence in a sector where it had previously struggled to compete.
Meanwhile, Qualcomm’s reliance on external manufacturers could have been reduced by using Intel’s in-house fabrication facilities.
Based on Intel’s current market value , the deal would have been the most expensive purchase of a technology hardware firm yet – beating Broadcom’s acquisition of VMWare in 2023.
As the government looks to boost its domestic manufacturing prowess, a successful purchase could have transformed the landscape for semiconductors in the U.S. had it gone through.
Arm Holdings Rejected by Intel
Unlike Qualcomm’s reported decision to move away from a potential Intel acquisition, U.K.-based chip manufacturer Arm Holdings had its bid rejected.
Arm was reportedly denied its attempt to purchase the company’s product division, with Intel claiming the business was not for sale.
How much Arm proposed for the company is unclear, nor if talks were still active at the time with Intel.
Following its disappointing Q2 results, Intel sold its stake in Arm for an estimated $147 million just one year after its investment, looking to claw back some lost costs.
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