On the eve of the outbreak of AI PC, there were major mergers and acquisitions, and the industry chain pattern was reshaped by Qualcomm?

1. Rumor: Qualcomm plans to acquire Intel entirely, shaking the industry

• Intel's stock price continued to fall during the year, and the crisis intensified and the market value shrank after the Q2 financial report, which was regarded as the background that triggered acquisition intentions;
• If the transaction is completed, it will beOne of the largest mergers and acquisitions in semiconductor history, directly impacting the global PC and server chip landscape.

2. Motive: Make up for the shortcomings of PC and attack the AI PC market

1. Enhance PC and AI computing power: Qualcomm is the leader in mobile phone chips, with a market share of less than 3% in PCs; acquiring Intel can directly access the x86 ecosystem, PC/server R&D and customer resources, superimposing itselfSnapdragon X EliteThe advantages of the AI PC platform can quickly increase the voice of AI PC.
2. Technical complementarity and synergy: Integrate Qualcomm 5G/mobile AI and Intel PC/server/data center technology to create cross-platform high-performance AI PC products and strengthen competitive barriers against AMD and NVIDIA.
3. Fend off Arm competition: Suppress Arm-based rivals such as MediaTek and consolidate its dual advantages on the mobile and AI sides.

3. Obstacles: Antitrust, difficulty in integration, patents and financial pressure

1. Antitrust scrutiny is extremely high: The merger of the two major camps of x86 and Arm is likely to be rejected by regulatory authorities in the United States, China, and Europe. Refer to Qualcomm’s failure to acquire NXP in 2016.
2. IDM conflicts with Fabless mode: Qualcomm fabless, Intel has huge manufacturing capacity (18A process investment period), and will bear the burden after integrationHuge amounts of heavy assets and financial burdens。
3. x86 patent licensing dilemma: Intel and AMD have an x86 cross-license, which needs to be renegotiated after the change of control. Qualcomm may not be able to legally produce x86-64 chips.
4. Huge financial pressure: Intel’s market capitalization is approximately US$93 billion, while Qualcomm’s cash + marketable securities are only approximately US$13 billion. The funding gap exceeds US$80 billion. After the merger, the net interest rate may plummet from 20%+ to single digits.

4. Intel’s self-rescue: selling assets, seeking financing, and betting on the 18A process

• Liquidate Arm shares (cash out approximately $150 million) and consider selling Mobileye and enterprise network units;
• Obtained Apollo Global$5 billion in financingIntention, does not rule out the independent operation of the wafer department to attract investment;
• core stakes bets18A process mass production, trying to reverse the decline and revitalize the overall situation with advanced technology.

5. Impact on the industrial chain: Regardless of mergers and acquisitions, the landscape has changed

1. AI PC competition intensifies: Even if the acquisition fails, the Qualcomm + Arm camp has made a strong entry with the Snapdragon X series, with support from Microsoft and Lenovo.AI PC enters the era of x86 (Intel/AMD) and Arm (Qualcomm/Apple) duel。
2. Intel becomes the biggest variable in the industry chain: As a core PC/server supplier, its continued decline will impact the stability of the supply chain.The strength comparison of the AI PC camp may be rewritten。
3. China supply chain opportunities and challenges: If Intel shrinks, domestic CPUs (such as GigaDevice and Loongson) and the AI PC industry chain are expected to fill the gap; at the same time, we need to be alert to the order transfer risks caused by the restructuring of the global supply chain.