Intel stock falls following statement from Broadcom CEO about not considering M&A deal
Intel experienced a dip in its stock price after the CEO of Broadcom indicated that there were no current plans for a merger or acquisition involving Intel. This news comes after Broadcom’s impressive earnings report and positive revenue forecast for the upcoming quarter, which resulted in a significant increase in its stock value during premarket trading.
Despite the positive performance of Broadcom, this news did not have a positive effect on other chip stocks in the market. In fact, some of the comments made by Broadcom’s CEO may have actually dampened optimism for certain players in the industry, including Intel.
When asked about potential merger and acquisition activities, specifically regarding Intel, CEO Hock Tan stated, “M&A, no, I’m too busy — we’re too busy doing AI and VMware at this point. We’re not thinking of it at this point.” This response indicates that Broadcom is currently focused on other initiatives and does not have immediate plans for any potential deals involving Intel.
Earlier in the year, there were reports that both TSMC and Broadcom were exploring options to acquire different parts of Intel. TSMC was considering the acquisition of Intel’s foundry business, while Broadcom was interested in the design unit. However, with Broadcom’s recent statements, it seems that these acquisition plans may not come to fruition in the near future.
Following this news, Intel’s stock experienced a 1% decline in premarket trading, making it one of the worst performers in the VanEck Semiconductor ETF. This shows that investors may have reacted negatively to the news of a potential lack of acquisition interest from Broadcom, impacting Intel’s stock value in the short term.
Overall, while Broadcom’s positive earnings report and revenue outlook have had a beneficial impact on its stock price, the lack of clarity regarding potential mergers and acquisitions involving Intel has created some uncertainty in the market. As the situation continues to unfold, investors will be closely watching for any developments that may provide more insight into the future of these companies in the semiconductor industry.