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Would Intel (INTC) End Samsung’s (SSNLF) Affiliation with Qualcomm (QCOM)?

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Investopedia reports that Samsung and Intel may seal an official deal soon

It has only been a couple of days since we reported that Samsung Electronics will presumably be the only company licensed to produce Qualcomm Inc’s (NASDAQ:QCOM) Snapdragon 830 chips. Now reports are surfacing that Intel Corporation (NASDAQ:INTC) is in the process of affiliation with the South-Korean giant for the chip manufacturing of its next generation of smartphones. Investopedia reports that both these companies may seal an official deal in the coming times.

While that may be of use to Intel, it is in not very good news for the San Diego-based Qualcomm, whose stock recently hit a new 52-week high level. The affiliation with Samsung is not quite old, as both the companies joined hands at the beginning of this year, and it seemed that the deal would help the $100 billion company in the long run.

Despite some heavy blows relating to the Galaxy Note 7 replacement, Samsung is not giving up on any of its core businesses, as it looks for alternatives other than Qualcomm. That being said, it would indeed be the second biggest blow for the chipmaker this year, as Apple has previously rewarded partial contract of its iPhone 7’s to Intel earlier in June. It is important to note here that both Apple and Samsung account for over 85% of high-end smartphone chip sales.

Qualcomm has been experiencing a decline in its revenues lately; however the strong financial management of the company did outweigh the drop. The company recently declared a dividend of $0.53, which shows that it creates value for its shareholders. We expect a bear wave to plummet Qualcomm stock in the coming sessions; however we persist on our bullish views, given the company’s expansion on multiple fronts. We believe Intel stock will follow a bullish wave after the recent news.

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