The move enables the mobile chip maker to become a leading supplier of semiconductors for automobiles. As Fred Katayama reports, it's the biggest deal ever in the chip industry.
It's the biggest deal ever in the deal-studded chip industry. Qualcomm is buying NXP Semiconductors for about $38 billion, creating a company that'll have revenue of more than $30 billion. The move will enable Qualcomm to move beyond making chips for iPhones and other mobile devices over into semiconductors for automobiles. Roughly 40 percent of NXP's revenue comes from automotive electronics. Qualcomm CEO Steve Mollenkopf: SOUNDBITE: STEVE MOLLENKOPF, CEO, QUALCOMM, (ENGLISH) SAYING: "We believe the combination will create the semiconductor engine for the connected world. With NXP, we will extend our mobile technology leadership and footprint into attractive growth opportunities. We will have the leading position in automobile, a strong mobile security position, as well as strength in the low power computing solutions that are critical for consumer and industrial IOT." Qualcomm's purchase enables it to reduce its reliance on the smartphone market just as the market for mobile phones has begun to slow. It says the deal will enable it to cut annual costs by half a billion dollars within two years after the deal closes. It expects to close that deal by the end of next year.