Qualcomm CEO Cristiano Amon speaks at the Computex forum in Taipei, Taiwan, June 3, 2024.
Ann Wang | Reuters
Qualcomm recently approached struggling chipmaker Intel about a takeover, CNBC has confirmed.
It wasn’t clear if Intel had engaged in conversations with Qualcomm or what the terms would be, according to a person familiar with the matter who asked not to be named because the information was confidential.
The Wall Street Journal was first to report on the matter. Intel shares initially popped on the news before closing up about 3%, while Qualcomm shares fell about 3% at the close.
The deal, if it were to happen, would be one of the largest technology mergers ever. Intel has a market cap of over $90 billion.
Once the world’s largest chipmaker, Intel has for years been in a downward spiral that accelerated in 2024. The stock had its biggest one-day drop in over 50 years in August after the company reported disappointing earnings. Intel shares are down 53% this year as investors express doubts about the company’s costly plans to manufacture and design chips.
Qualcomm and Intel compete in several markets, including for PC and laptop chips. However, Qualcomm, unlike Intel, doesn’t manufacture its own chips, and instead relies on firms such as Taiwan Semiconductor Manufacturing Company and Samsung to handle production.
On Monday, after a board meeting to discuss strategy, Intel CEO Patrick Gelsinger sent a memo to staff that reiterated the company’s commitment to investing heavily in its foundry business, a project that could cost $100 billion over the next five years. It also said that it was weighing outside investment.
Intel has also missed out on the artificial intelligence boom that’s captured the attention of Wall Street. Most of the advanced AI programs, such as ChatGPT, run on Nvidia graphics processors, instead of Intel central processors. Nvidia has more than 80% of the fast-growing market, according to analysts.
Qualcomm generates less revenue than Intel. It reported $35.8 billion in sales in fiscal 2023, compared with Intel’s $54.2 billion during the same period.
A potential deal would be complicated by antitrust and national security matters. Both Intel and Qualcomm do business in China, and both have seen deals scuttled by Chinese antitrust enforcers. Intel was unsuccessful with its attempted acquisition of Tower Semiconductor, as was Qualcomm in its bid to acquire NXP Semiconductor.
Other giant acquisitions in the space have also been scuttled. In 2017, Broadcom made a bid to buy Qualcomm for more than $100 billion. The Trump administration blocked the deal the following year on national security concerns, because Broadcom was based in Singapore at the time. And in 2021, the Federal Trade Commission sued to block Nvidia’s attempted purchase of Arm on antitrust grounds. The deal was called off in 2022 following additional pressure from regulators in Europe and Asia.
Representatives for Qualcomm and Intel declined to comment.
Artificial intelligence robot looking at futuristic digital data display.
Yuichiro Chino | Moment | Getty Images
Artificial intelligence is projected to reach $4.8 trillion in market value by 2033, but the technology’s benefits remain highly concentrated, according to the U.N. Trade and Development agency.
In a report released on Thursday, UNCTAD said the AI market cap would roughly equate to the size of Germany’s economy, with the technology offering productivity gains and driving digital transformation.
However, the agency also raised concerns about automation and job displacement, warning that AI could affect 40% of jobs worldwide. On top of that, AI is not inherently inclusive, meaning the economic gains from the tech remain “highly concentrated,” the report added.
“The benefits of AI-driven automation often favour capital over labour, which could widen inequality and reduce the competitive advantage of low-cost labour in developing economies,” it said.
The potential for AI to cause unemployment and inequality is a long-standing concern, with the IMF making similar warnings over a year ago. In January, The World Economic Forum released findings that as many as 41% of employers were planning on downsizing their staff in areas where AI could replicate them.
However, the UNCTAD report also highlights inequalities between nations, with U.N. data showing that 40% of global corporate research and development spending in AI is concentrated among just 100 firms, mainly those in the U.S. and China.
Furthermore, it notes that leading tech giants, such as Apple, Nvidia and Microsoft — companies that stand to benefit from the AI boom — have a market value that rivals the gross domestic product of the entire African continent.
This AI dominance at national and corporate levels threatens to widen those technological divides, leaving many nations at risk of lagging behind, UNCTAD said. It noted that 118 countries — mostly in the Global South — are absent from major AI governance discussions.
UN recommendations
But AI is not just about job replacement, the report said, noting that it can also “create new industries and and empower workers” — provided there is adequate investment in reskilling and upskilling.
But in order for developing nations not to fall behind, they must “have a seat at the table” when it comes to AI regulation and ethical frameworks, it said.
In its report, UNCTAD makes a number of recommendations to the international community for driving inclusive growth. They include an AI public disclosure mechanism, shared AI infrastructure, the use of open-source AI models and initiatives to share AI knowledge and resources.
Open-source generally refers to software in which the source code is made freely available on the web for possible modification and redistribution.
“AI can be a catalyst for progress, innovation, and shared prosperity – but only if countries actively shape its trajectory,” the report concludes.
“Strategic investments, inclusive governance, and international cooperation are key to ensuring that AI benefits all, rather than reinforcing existing divides.”
Altimeter Capital CEO Brad Gerstner said Thursday that he’s moving out of the “bomb shelter” with Nvidia and into a position of safety, expecting that the chipmaker is positioned to withstand President Donald Trump’s widespread tariffs.
“The growth and the demand for GPUs is off the charts,” he told CNBC’s “Fast Money Halftime Report,” referring to Nvidia’s graphics processing units that are powering the artificial intelligence boom. He said investors just need to listen to commentary from OpenAI, Google and Elon Musk.
President Trump announced an expansive and aggressive “reciprocal tariff” policy in a ceremony at the White House on Wednesday. The plan established a 10% baseline tariff, though many countries like China, Vietnam and Taiwan are subject to steeper rates. The announcement sent stocks tumbling on Thursday, with the tech-heavy Nasdaq down more than 5%, headed for its worst day since 2022.
The big reason Nvidia may be better positioned to withstand Trump’s tariff hikes is because semiconductors are on the list of exceptions, which Gerstner called a “wise exception” due to the importance of AI.
Nvidia’s business has exploded since the release of OpenAI’s ChatGPT in 2022, and annual revenue has more than doubled in each of the past two fiscal years. After a massive rally, Nvidia’s stock price has dropped by more than 20% this year and was down almost 7% on Thursday.
Gerstner is concerned about the potential of a recession due to the tariffs, but is relatively bullish on Nvidia, and said the “negative impact from tariffs will be much less than in other areas.”
He said it’s key for the U.S. to stay competitive in AI. And while the company’s chips are designed domestically, they’re manufactured in Taiwan “because they can’t be fabricated in the U.S.” Higher tariffs would punish companies like Meta and Microsoft, he said.
“We’re in a global race in AI,” Gerstner said. “We can’t hamper our ability to win that race.”
YouTube on Thursday announced new video creation tools for Shorts, its short-form video feed that competes against TikTok.
The features come at a time when TikTok, which is owned by Chinese company ByteDance, is at risk of an effective ban in the U.S. if it’s not sold to an American owner by April 5.
Among the new tools is an updated video editor that allows creators to make precise adjustments and edits, a feature that automatically syncs video cuts to the beat of a song and AI stickers.
The creator tools will become available later this spring, said YouTube, which is owned by Google.
Along with the new features, YouTube last week said it was changing the way view counts are tabulated on Shorts. Under the new guidelines, Shorts views will count the number of times the video is played or replayed with no minimum watch time requirement.
Previously, views were only counted if a video was played for a certain number of seconds. This new tabulation method is similar to how views are counted on TikTok and Meta’s Reels, and will likely inflate view counts.
“We got this feedback from creators that this is what they wanted. It’s a way for them to better understand when their Shorts have been seen,” YouTube Chief Product Officer Johanna Voolich said in a YouTube video. “It’s useful for creators who post across multiple platforms.”