A Qualcomm acquisition of NXP would only continue a consolidation trend within the chip industry over the past several years, and analysts predict more deals are on the way. Other high-profile deals include Intel buying programmable chip maker Altera for $16.7 billion, Avago Technologies' $37 billion deal for Broadcom (and then adopting the Broadcom name), Renesas Electronics' $3.2 billion acquisition of Intersil and Cypress Semiconductor buying Broadcom's IoT business for $550 million. In addition, tech vendor Softbank is buying ARM for $32 billion.
Reports of Qualcomm's possible acquisition of NXP has some analysts saying it opens the door for Broadcom to buy Xilinx, which like Altera makes field-programmable gate arrays (FPGAs).
Moorhead said the consolidation in the chip industry will continue as vendors look to grow what they can put onto their processors as they continue to expand into new markets and systems. With Altera, Intel can now integrate FPGAs onto their processors. The analyst said that teardowns of various devices will show how the use of discrete components is dwindling, and gives an idea of where the chip industry is heading.
"When you look at a teardown, wherever you see discrete components, there is the potential area for consolidation," Moorhead said.