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Qualcomm

Qualcomm is a giant in the modern telecommunications market. Its modems and smartphone SoCs power hundreds of millions of devices across the world. Rumors suggest that Qualcomm might be planning to acquire NXP Semiconductor in a deal worth at least $thirty billion.

Talks between the 2 companies are expected to keep over the next few months, the Wall Street Journalreports. If Qualcomm is a high-profile success story that's risen to boss modem licensing and smartphone SoC design, NXP Semiconductor is the multi-billion dollar semiconductor company yous oasis't heard of. Today, NXP focuses on the Net of Things, RFID-equipped devices, embedded markets, and ultra-depression ability advice. Its technologies are used in multiple public transit systems across the world and it helped invent (and holds patents relating to) About Field Communication, or NFC.

The timing of the motion might enhance some eyebrows, given that NXP just finished acquiring Freescale Semiconductor in March 2015. Mergers always take some fourth dimension to atomic number 26 out and combining disparate corporate cultures isn't easy. Like NXP, Freescale focuses on ultra-pocket-sized, ultra-low-power devices.

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If Qualcomm buys NXP, it'll probably do and then for several reasons. First, NXP has key patents related to various types of wireless advice, and Qualcomm derives more than than half its turn a profit on licensing modem patents to other companies. Locking up NFC and snapping up some wireless charging patents would offering boosted revenue streams. There's likewise the full general interest in IoT, embedded computing, and self-driving vehicles — areas where NXP is already winning business and Qualcomm could aggrandize. The WSJ reports that ownership NXP would instantly catapult Qualcomm to being the number-one supplier of chips used in vehicles — and in-vehicle computing is a hot topic these days.

Integrating the ii companies would be a formidable task. Qualcomm currently employs 33,000 employees, while NXP has 45,000. A strategic partnership or articulation venture might requite Qualcomm access to some of the upside of buying NXP outright without exposing information technology to the risk of attempting to integrate a larger business than its own. The companies that earn the well-nigh money in semiconductors are the companies that are first to market, whether that means being the first foundry to offering a new process node, or being the first modem supplier to offer full LTE support.

This would be a huge move for Qualcomm, and the first major shake-upward to the company since it shook off corporate raiders at Jana Partners LLC earlier this yr. Jana was behind the button to strength Qualcomm to divest its semiconductor R&D and split the company into a patent licensing and R&D division. Qualcomm decided against this approach and Jana sold its shares thereafter. Good riddance.