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Illustration: Aïda Amer/Axios

Although most eyes were on the impeachment and other Washington goings-on, Wednesday was a big day for the chip industry, which produced a 10-figure deal and a major leadership shakeup.

The big picture: Legacy chip players Intel and Qualcomm have watched other companies eat into the business lines that got them where they are. They're now seeking to seize control of their own fates.

Driving the news: First, Qualcomm said it's paying $1.4 billion to buy Nuvia, a semiconductor startup founded by ex-Apple engineers.

  • Then Intel announced that former executive Pat Gelsinger was coming back to be CEO as the company tries to address the many manufacturing and competitive challenges it faces.

Background: Historically, chip players have largely played particular roles. Intel was big in PCs and servers. Qualcomm was big in mobile phones. AMD has oscillated between giving Intel a run for its money and just plain losing money.

Where it stands: It's currently Intel that's facing manufacturing challenges and competitive threats, while AMD is enjoying its strongest position in years, even winning server business.

  • Meanwhile, Qualcomm is looking to expand its business in PCs and cars as it faces a saturated smartphone market whose largest players — Apple and Samsung — are increasingly turning to homegrown processors.

Between the lines: Buying Nuvia gives Qualcomm the opportunity to further differentiate its Snapdragon chips since Nuvia uses a custom core, rather than the standard off-the-shelf ARM processor.

  • Nuvia could also give Qualcomm another shot at the data center market. Qualcomm abandoned its most recent server chip effort, but Nuvia was focused on servers before the acquisition, with plans to finalize its first server chip design this year.

Intel, despite its struggles, is still making plenty of money. And although Apple has decided to go in-house, Windows machines still mostly run on Intel or AMD processors.

  • Gelsinger has his work cut out for him, but also knows Intel well, having spent three decades at the company.

Go deeper

Ina Fried, author of Login
Jan 13, 2021 - Technology

Qualcomm buying server chip startup Nuvia for $1.4 billion

Image: Qualcomm

Qualcomm said Wednesday it will pay $1.4 billion to buy Nuvia, a chip startup founded by former Apple employees.

Why it matters: The move gives Qualcomm fresh ideas for chip designs as the company faces intense competition from Intel, AMD and others.

Ina Fried, author of Login
Jan 13, 2021 - Technology

Intel names former exec Pat Gelsinger as new CEO

Gelsinger. Photo: Intel

Intel said Wednesday that VMware CEO Pat Gelsinger will return to the chipmaker as CEO, with current chief Bob Swan stepping down as of Feb. 15.

Why it matters: Intel faces a host of challenges from manufacturing issues to competition from rival AMD to Apple's move to use homegrown chips in the Mac.

Sen. Sheldon Whitehouse under scrutiny for elite club affiliations

Sen. Sheldon Whitehouse during a Senate hearing on Capitol Hill in February. Photo: Susan Walsh-Pool/Getty Image

Sen. Sheldon Whitehouse (D-R.I.) said in a statement Wednesday that he is a member of an exclusive Rhode Island sailing club that lacks diversity.

Why it matters: Whitehouse has repeatedly spoken out against systemic racism and come under scrutiny this week for his family's affiliation with elite clubs. This is the second such club accused of lacking diversity that the senator has been linked to in recent days