Qualcomm eyes modular AI deal as stock falls on tech selloff pressure

Qualcomm Inc. shares moved lower on Tuesday, falling about 6% in trading as a broader technology selloff weighed on sentiment, even as fresh reports pointed to an expansion of its artificial intelligence ambitions.

The decline came despite Bloomberg reporting that Qualcomm is in advanced talks to acquire AI infrastructure software company Modular Inc. in a deal valued at around US$4 billion (approx. $5.2 billion).

A transaction could be announced in the coming weeks, though sources emphasized that a final agreement is not guaranteed and terms could still change.

Qualcomm stock has been one of the stronger performers in the semiconductor space in recent months, rising 72% over the past three months and gaining around 30% year to date.

Investors have been positioning ahead of the company’s investor day on Wednesday, where Qualcomm is expected to provide updates on its next-generation processor strategy and potentially identify a major customer for a custom data-center chip.

Modular acquisition would expand Qualcomm’s AI software push

Modular Inc., founded in 2022 in Silicon Valley by Chris Lattner and Tim Davis, two former Google employees, focuses on building software tools designed to simplify the deployment of artificial intelligence models across different hardware systems and cloud environments.

According to its website, the founders created the company after becoming “frustrated by AI’s fragmented infrastructure.”

The startup has positioned itself in a growing segment of the AI market focused on inferencing and cross-platform deployment, an area increasingly seen as critical as AI workloads expand beyond training into real-world applications.

Modular raised US$250 million (approx. $322.5 million) in a September funding round at a US$1.6 billion (approx. $2.1 billion) valuation, bringing total capital raised to US$380 million (approx. $490.3 million).

The reported acquisition price of roughly US$4 billion (approx. $5.2 billion) would represent more than a 2.5-times increase in valuation in less than two years.

The company is backed by investors including DFJ Growth, Factory, General Catalyst, Google Ventures, Greylock Partners and US Innovative Technology Fund.

Qualcomm pursues broader AI acquisition strategy

The Modular discussions are part of a wider acquisition strategy aimed at strengthening Qualcomm’s position in artificial intelligence.

The Information in a seperate report said that the company is in talks to acquire AI chip startup Tenstorrent for between US$8 billion (approx. $10.3 billion) and US$10 billion (approx. $12.9 billion).

If completed, the two deals would reflect a dual-track AI expansion strategy: hardware capabilities through Tenstorrent and software infrastructure through Modular.

Qualcomm has previously pursued similar expansion efforts through acquisitions, including its agreement to buy Alphawave IP Group Plc for about US$2.4 billion (approx. $3.1 billion) in cash.

Its earlier attempt to acquire NXP Semiconductors NV was ultimately scrapped due to regulatory hurdles.

The company is expected to use its upcoming investor day to provide further details on its AI roadmap, including custom chip development and potential major customer relationships.

Despite the acquisition momentum, Qualcomm shares remain under pressure in the near term amid a broader tech sector downturn.