A report from Kitguru suggests that Microsoft may be eyeing struggling chipmaker AMD as a potential acquisition. The news arrives via an unnamed source who claims that Microsoft approached the chip maker several months ago.
The details of the acquisition talks are unknown for now, but the report points to Microsoft s $95.3 billion in cash and AMD s value of $1.81 billion. Clearly Microsoft has the cash to make the acquisition happen.
Currently, AMD trails behind Intel in the CPU market. However, the company provides the APUs that power both the Sony PlayStation 4 and Microsoft s Xbox One console. Microsoft has sold an estimated 12.6 million Xbox One units since the console s launch.
Take that number and mulitply it by the $100 Microsoft pays AMD per console, and you've got $1.26 billion. By acquiring AMD, Microsoft would presumably save billions while also getting a small cut from console rival Sony Entertainment, thanks to the APU in the PlayStation 4.
The report points out that if the acquisition does in fact take place, Microsoft would save even more money by producing its own SoCs for smartphones and tablets. This would seemingly help Microsoft s plan for having one operating system for all form factors: having APUs in the Xbox One, in phones, in tablets and in desktops and notebooks.
This is not the first time we ve heard of an AMD acquisition. A rumor surfaced back in March that Samsung was eyeing the APU maker again after contemplating an acquisition back in 2007. As we wrote back then, Samsung would take advantage of AMD s GPU and CPU technology to better compete with rival Qualcomm.
The latest rumor arrives after another rumor surfaced last week claiming that AMD may split its business in half or spin off several divisions so that it can better compete with rival chip maker Intel. The rumor was based on three people familiar with the matter and indicated that CEO Lisa Su was investigating every possible avenue to get the company in the black.
According to Reuters, AMD has hired a consulting firm to create scenarios to help determine how splitting the company in half or selling off portions would work. One scenario sees AMD spinning off its licensing and graphics business from its server department. However, AMD denies that such a project even exists.
As for the latest rumor, would Microsoft be a better fit as AMD s parent company? The situation is quite interesting, and could force Sony to choose another processor maker for its next console. Unfortunately, both AMD and Microsoft didn t comment on the rumor.