Qualcomm Inc. (QCOM) shares slid around 6% on Tuesday as a broader tech selloff pressured the semiconductor stock, even as reports surfaced that the company is in advanced talks to acquire AI infrastructure software firm Modular Inc. for roughly $4 billion and, separately, in discussions to supply custom chip-design services to ByteDance, the Chinese parent of TikTok.
The Modular acquisition, first reported by Bloomberg, would mark a major push into AI software. Founded in 2022 by former Google employees Chris Lattner and Tim Davis, Modular builds tools to simplify deploying AI models across different hardware and cloud environments. The startup raised $250 million in September at a $1.6 billion valuation, and the reported $4 billion price tag would represent more than a 2.5x jump in value in less than two years. The talks are part of a wider acquisition strategy by Qualcomm; additional reports indicate the company is also negotiating an $8–10 billion deal for AI chip startup Tenstorrent, signaling a dual-track hardware and software AI expansion.
Separately, Reuters revealed that Qualcomm is in talks with ByteDance to provide custom chip-design services, with a focus on video processing units (VPUs) that could begin mass production by the end of 2026. The chips would partly use technology from AlphaWave Semi, which Qualcomm acquired last year. If finalized, ByteDance would become an early customer for Qualcomm’s emerging chip-design services unit, helping the company diversify beyond the struggling smartphone market, where global handset shipments are expected to post their steepest annual decline on record.
Qualcomm CEO Cristiano Amon has been actively steering the company toward data center CPUs, AI inference accelerators, and custom ASICs, positioning it against Broadcom and Marvell Technology. The company’s investor day is scheduled for Wednesday, where further details on the AI roadmap and a potential major data-center chip customer are expected.
