INTEL SHARE PRICE INCREASES AS IT QUITS 5G BASEBAND R&D

Intel announced today that it is withdrawing from the 5G smartphone baseband businessand will continue to focus on investing in the 5G network infrastructure business in the future. In order to dispel the concerns of the outside world, Intel said in its latest announcement that their existing 4G mobile phone baseband will not give up, the supply will continue normally.Intel CEO, Bob Swan, has this to say concerning the company’s withdrawal

“We are very excited about the opportunity in 5G and the cloudification’ of the network, but in the smartphone modem business, it has become apparent that there is no clear path to profitability and positive returns”…”The company will continue to meet current customer commitments for its existing 4G smartphone modem product line, but does not expect to launch 5G modem products in the smartphone space, including those originally planned for launches in 2020.”

Intel also stressed in the announcement that the abandonment of the 5G mobile phone baseband is resolute, and the corresponding products to be launched in 2020 should also be canceled. Intel’s share price volatility on Wednesday rose slightly by 0.76% almost immediately after its withdrawal and after a few hours, the stock price rose by more than 4%. It appears that this decision is a good one from Intel as the company seems to be struggling with 5G modems for smartphones. 

Prior to Intel’s announcement, Qualcomm and Apple reached a settlement on its lingering patent dispute. Both parties also announced that they agreed to abandon all litigations worldwide. The settlement agreement includes Apple’s payment of an undisclosed amount to Qualcomm and a chipset supply agreement, which may pave the way for the iPhone to re-use its modem chip.