Intel's fortunes have declined so rapidly over the past year that chip designer ARM made a “high-level consultation” about purchasing its crown jewel products unit. Bloomberg reported. However, Intel said the division was not for sale and rejected the offer, according to an anonymous source.
There are two main units within Intel, the products group that sells PC, server and networking chips and a chip manufacturing foundry. ARM had no interest in Intel's foundry division, according to BloombergThe sources. Representatives for ARM and Intel declined to comment.
Intel's fortunes have been declining for years, but the decline over the past 12 months has been especially dramatic. Following a net loss of $1.6 billion in the second quarter of 2024, the company announced it would lay off 15,000 employees as part of a $10 billion cost reduction plan. Last week, the company also revealed plans to transform its ailing foundry business into an independent subsidiary. Intel lost half its market value last year and is now worth $102.3 billion.
ARM sells its processor designs to Qualcomm, Apple and other manufacturers (mainly for mobile phones), but does not make any chips. Buying Intel's products division would completely transform its business model, although that scenario seems highly unlikely.
With Intel hurt right now, rivals have been circling. Qualcomm also recently expressed interest in acquiring Intel, according to a report last week. Any merger involving ARM and Qualcomm would be a regulatory nightmare, but the fact that deals exist shows Intel's vulnerability.
Intel has other avenues to drive investment. Apollo Global Management (owner of Yahoo and Engadget) has offered to invest up to $5 billion in the company, according to a recent Bloomberg report. Intel also plans to sell part of its stake in chipmaker Altera to private equity investors.
