Just last Monday, Intel announced a new future: control of the global software industry for quantum computing through the acquisition of Israeli company Classiq, which has the largest market share in the field. The investors, however, did not show undue enthusiasm for this, and forgot about the deal very quickly; three days later they punished Intel for its third quarter results. The rise in the price of personal computers harms the company’s traditional sales channel, namely chips for laptops, and the explosion at the factory in Kiryat Gat reduced the sales forecast for the next quarter.
Then came the big wave of declines in the tech sector because of the fear of a bubble in AI, as the semiconductor giants spend huge amounts while the horizon for profitability remains distant, on top of which came the prospect of tight regulation of the construction of server farms by Democratic state governors and local government officials following the results of the US midterm elections.
Intel’s share price has fallen by 42% since the close of trading last Tuesday, the session after the announcement of the purchase of Classiq. In the past month, Intel has seen 55% wiped off its value. The chip company which was valued at half a trillion dollars at the beginning of last month now has a market cap of only $277 billion, even though in its financials it actually indicated a positive direction: sales of core processors for cloud servers and AI increased by 78%, generated an operating profit of $3 billion and reduced the company’s exposure to the personal computing market to 49%
Is the deal in jeopardy?
The dramatic decline raised concerns that Classiq’s price in the deal – $2.2 billion – might crash as well, since the deal was closed in Intel shares. Is the biggest quantum deal ever in jeopardy?
In the purchase announcement it published, Intel did not specify how it would pay Classiq’s shareholders, but later, when it released its third quarter financials, Intel provided a hint of what was to come. First, Intel broke the deal into two parts: $1.9 billion, “subject to purchase price adjustments”, and another $350 million dependent on meeting milestones that will be transferred to shareholders several years after the deal is closed.
Intel says that the transaction will be closed only in the first half of next year, and will be subject to regulatory approvals and additional conditions. The company explains in its 10-Q filing that it has not yet determined how much of the acquisition price will be paid in cash and how much in Intel shares.
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“Globes” has learned that the companies have agreed between them on payment in the form of Intel shares, without a cash component at this stage, but this may change by the time of the closing, which is expected to be only at the beginning of next year, according to Intel’s statement in the reports. The price is not in danger of crashing since shares have not yet been allocated to the shareholders and this may happen only after the closing event and will be in accordance with the average price of the shares in the period leading up to it. In any case, Intel agreed to give the shareholders a consideration equal to the agreed valuation, $2.2 billion (the company has $100 million in cash, which reduces the amount of the final transaction price) after the closing of the transaction, when it will decide whether it wishes to keep the acquisition as a share transaction or whether to involve cash in it.
Intel has a cash and cash equivalents of $54 billion plus a credit line of $15 billion, but it will probably need them to increase its capital expenditures on the construction of factories in Ohio, Arizona, Oregon, Malaysia and New Mexico and to reduce its debt, which stands at about $50 billion.
Published by Globes, Israel business news – en.globes.co.il – on November 8, 2026.
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