Qualcomm’s Latest Announcements A Timely Jab At Broadcom

Last month, Broadcom caused quite the reaction after it shot off an unsolicited offer to Qualcomm, flaunting a cheque that barely went beyond the company’s market cap. Most, including Qualcomm itself, thought that the offer was underwhelming, or perhaps even insulting.

On the other side of the coin, an acquisition like this could be met with major or perhaps impenetrable roadblocks. However, Broadcom has said that it doesn’t plan to back down, so it clearly believes that there would be no legal blocks preventing such an acquisition from taking place. It’s proving that by perusing a hostile takeover, hoping shareholders may see things differently.

However, this is the crux of the matter: Qualcomm (NASDAQ: QCOM) has great momentum at the moment. We’re at a point where Snapdragon is now 10-years-old, and it’s dominating the Android device market. Last month, we learned of the company’s next move to battle Intel, with its Centriq 2400 series, destined for the datacenter. The potential there is enough to make Qualcomm keep calm on offers, because waiting a year from now could paint an even more positive outlook, and thus, a beefier company valuation.

Fast-forward to this week, where Qualcomm is unveiling information about its upcoming “always-on” ultraportable notebooks, with ASUS, HP, and Lenovo vowing support so far. Not to mention Microsoft, which has recompiled all of its Windows OS to support the ARM64 architecture. These machines also use emulation to convert x86 code into ARM64 code, promising to deliver near-native performance, and in some cases, performance parity. Power is also the big talking point here, with notebooks promising more than all-day battery-life.

Following-up on its latest notebook announcements, Qualcomm also revealed a lot more about its Snapdragon 845, the upcoming flagship SoC that will first hit phones and stand-alone VR devices, (and inevitably, its always-on notebook platform – though Qualcomm has kept mum on specifics there). With it comes an enhanced feature set, and huge strides made to the camera, color accuracy, video playback, security, and last, but not least, a bolstering of AI performance and capabilities.

Qualcomm has long wanted an “always-on” Windows notebook; now they’re arriving early 2018

Bearing all of this in mind, it’s hard to imagine that an acquisition from Broadcom would bode well for Qualcomm. Qualcomm’s independence has allowed it to push itself forward in numerous segments, and based on what’s been revealed at the company’s Tech Summit, the company’s momentum isn’t slowing down. We don’t have enough companies like Qualcomm, which continually innovates. When is the last time you can recall having such a massive unveiling so late in the year? In advance of CES, no less, where the company promises to share more follow-up information (and perhaps it has some other announcements in the cards, as well).

It’s for that reason that Qualcomm’s shareholders should think through the hostile takeover option very carefully if they’re tempted. Qualcomm’s continually innovating and integrating new technologies, sometimes before we know we want them, whereas Broadcom’s interest in R&D in comparison is tepid at best.

Nonetheless, it will be interesting to see how Broadcom chooses to go forward. As for now, Qualcomm remains completely disinterested, choosing to continue doing what it’s been doing to put itself in the current position it’s in.