Semiconductors

Samsung is closer to maxing out memory limits

5 Oct 2018

South Korea's tech titan expects quarterly operating profit to hit a record $15 bln, thanks to an upswing in chip demand. Memory prices will probably peak by year-end, however. Slower earnings growth, and the mounting legal woes of Samsung's leaders, will test investor patience.

M&A bankers better off hunting pheasant than elk

3 Oct 2018

The value of deals above $10 bln popped by 150 pct in the first nine months of the year. Some, like Comcast’s purchase of Sky, come with chunky financing fees. Still, the glory is spread less thinly on smaller deals, which are also growing quickly, and are easier to close.

Bitmain mines for a more precious currency

3 Oct 2018

The world's top crypto equipment maker collected a third of its $2.5 bln in sales last year in bitcoin and its ilk. Converting some of it into cash has helped fund the profitable business. As prices of virtual money fall, though, raising $3 bln in an IPO would be a sweet trade.

Japan’s Renesas speeds into autonomous M&A wreck

11 Sep 2018

The Tokyo-based chipmaker is buying U.S. peer Integrated Device Technology for $6.7 bln. A promised uplift in revenue from selling self-driving and connected-car technology sounds optimistic. Even if Renesas can achieve such synergies, the return on investment barely stacks up.

NXP’s time in M&A wilderness leaves it unloved

6 Sep 2018

Qualcomm’s planned purchase left the $32 bln chipmaker in stasis for nearly two years. With the deal’s failure, its shares have fallen back to trade at a 30 pct discount to peers. NXP’s stand-alone story may be partly forgotten, but it’s well placed to hand investors a windfall.

Japanese chipmaker deal is hard to process

3 Sep 2018

Renesas Electronics is considering buying U.S. peer Integrated Device Technology, for a price that could be around $6 bln. Its last acquisition hasn’t obviously delivered and the implied return on investment of this one is just 5 pct. Small wonder that investors are skeptical.

Qualcomm is set to pitch life without NXP

25 Jul 2018

The $90 bln chipmaker’s $44 bln purchase of its rival could die on Wednesday unless Beijing gives it an 11th-hour nod. Traders seem to think that’s unlikely. Going it alone won’t be easy for Qualcomm, but in the 21 months since striking the NXP deal it has not stood still.

TSMC etches chip fortunes onto investor memories

19 Jul 2018

The $190 bln Taiwanese semiconductor maker delivered the $2 bln in quarterly earnings that was anticipated. Weak smartphone and cryptocurrency demand, as well as global trade tensions, will be a drag in the second half, though. Betting on AI and 5G should help TSMC longer-term.

Broadcom chief uses up eight of his nine lives

12 Jul 2018

With a single deal – the $19 bln acquisition of software company CA – Hock Tan has torched a reputation built through years of savvy acquisitions. Broadcom lost nearly $16 bln of market value at a stroke. Recovering from that will take time, luck and abstinence.

Broadcom’s new M&A strategy has a bug

11 Jul 2018

The $105 bln chipmaker’s prolific dealmaking has supercharged growth. But its size, and the torpedoing of its Qualcomm bid, left it bereft of natural targets. Expanding into software by buying CA brings new opportunities - and substantially increases the risks of pitfalls.

Chinese tension whips up a new chip super-cycle

5 Jul 2018

Micron suffered a fresh setback after a rival said a mainland court banned the $60 bln company from selling some circuitry in the country. Even as booming demand pushes prices up, legal battles and China’s quest for homegrown tech amid trade strains are reshaping the industry.

Intel scandal matters little today, a lot tomorrow

21 Jun 2018

The ouster of CEO Brian Krzanich for a relationship that breached company policy need not be a disaster. It shows the relevant rules apply to all, and Intel can run itself smoothly for a while. Mounting tech challenges, however, make it critical to find the right replacement.

Apple supplier’s M&A bite looks too much to chew

20 Jun 2018

British chipmaker Dialog is eyeing U.S. touchscreen group Synaptics. That would help it diversify away from main client Apple, which recently cut orders, and the returns look good. Yet funding a winning bid may mean taking on a slug of costly debt or raising equity.

China’s DRAM dreams may trigger glut memories

14 Jun 2018

Consolidation, rising costs, and technological limits have turned memory-chip production from a cash-burning exercise into a profitable triopoly. Chinese firms’ efforts to break in – along with Beijing’s pricing investigation – risk eroding the industry’s good times.

Investors think Qualcomm-NXP deal is back on

6 Jun 2018

The $44 bln chip acquisition-in-waiting may finally get approval from Beijing – if Chinese telecom-equipment group ZTE can turn a U.S. business ban into a less damaging fine. NXP’s stock is again trading within 10 pct of the offer price. It’s still a bet fraught with uncertainty.

TSMC’s new chips hint at life after Apple

19 Apr 2018

Quarterly sales at the $210 bln chipmaker topped $8 bln, missing estimates. Weak iPhone sales and fizzling bitcoin prices probably weighed. Even so, TSMC is set to debut cutting-edge new semiconductors that will position it ahead of rivals as AI and autonomous cars take off.

Qualcomm’s future stuck on slow boat to China

16 Apr 2018

The chipmaker’s strategy depends heavily on closing its $44 bln NXP deal. A possible trade war leaves Chinese regulators in no mood to approve the U.S. company’s purchase, though. Qualcomm does have one bright spot: its long-running spat with Apple may be coming to a head.

Qualcomm’s director election offers double rebuke

30 Mar 2018

Support for incumbents averaged under half the U.S. chipmaker’s outstanding shares. That’s a warning after the board resisted Broadcom’s $117 bln hostile bid, nixed by Donald Trump. Meanwhile, the convoluted process and an error voting Vanguard’s shares shame an archaic system.

Market jitters accentuate M&A regulatory risk

26 Mar 2018

Dealmaking sprees are prone to extinction events. Market panics erode the value of buyers’ stock, make bankers reluctant to lend, and change the outlook violently. Recent tumult doesn’t yet qualify, but it makes it harder to overlook deals that push the regulatory limits.

Qualcomm needs an intermediator more than a buyer

16 Mar 2018

The $90 bln chipmaker’s ex-chairman Paul Jacobs’ improbable buyout idea would need lots of help. The real key to boosting Qualcomm’s value is mending its rift with Apple. While Jacobs isn’t the man for that job, deep-pocketed SoftBank founder Masayoshi Son theoretically could be.