Intel Buys Its Way Into Wireless

Intel (Nasdaq:INTC) has seen the future, and it is no longer in PCs and laptops. If Intel wants to still be inside the devices that consumers are buying, the company needs to get moving in the smartphone market. Monday's purchase of Infineon's (Nasdaq:IFNNY) wireless chip unit may be a good move, but it is just a start.

What Intel Is Getting
Intel is buying Infineon's unit for $1.4B in cash - a price that looks to be a little less than 1x trailing revenue. If that sounds like a cheap price, there is a reason. Although Infineon has won a couple of high-profile placements (like Apple's (Nasdaq:AAPL) iPhone and iPad), the unit's profitability was quite a laggard relative to Infineon's other businesses or stand-alone chip companies like Qualcomm (Nasdaq:QCOM).

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