Today the Wall Street Journal reported that Broadcom wants to sell its RF chip business unit, which had $2.2 billion in sales in Broadcom’s 2019 fiscal year ended November 3, 2019.  This mirrors our recent blog post about Qualcomm that ended with the statement that Qualcomm’s recent announcements could drive more industry consolidation in cellular radio chips.

According to the WSJ, after failing in its effort to acquire Qualcomm, Broadcom shifted much of its focus to software with the acquisitions of CA Technologies and Symantec Corp’s corporate software business unit.  The RF unit does not fit especially well with Broadcom’s latest core business focus.

The RF business unit, which supplies power amps, FBAR filters and duplexers to mobile phone OEMs, is just part of Broadcom’s Wireless business division.  Other products in the Wireless business division include Wi-Fi / Bluetooth / GNSS combo chips, touch-screen controllers, and wireless charging chips.  Except possibly for some RF filters used in Wi-Fi, there isn’t particularly strong synergy across these products.  Many of Broadcom’s Wireless products get bought by Apple Inc., which accounted for about 25 percent of Broadcom’s net revenue in 2018.

Given the dynamics of the cellular radio chip market, we expect radio chip suppliers MediaTek, HiSilicon, Samsung, Apple, Skyworks and Murata to have an interest in Broadcom’s RF business unit.  Given the recent challenges to acquisitions of US technology firms by Asian companies, we think Apple could be the strongest contender.

Stay tuned for more about cellular RF front-end component market share in the coming weeks.