NXP in talks to buy chip developer Ambarella, FT reports (updated)
UPDATE 1-NXP in talks to buy chip developer Ambarella, FT reports Updates shares in paragraph 2, adds NXP's response in third bullet
July 31 (Reuters) - NXP Semiconductors NXPI.O is in talks to buy chip designer Ambarella AMBA.O, the Financial Times reported on Friday, citing people familiar with the matter.
Shares of Ambarella, which has a market capitalization of $3.25 billion, jumped about 19%, while NXP shares fell more than 3%, following the report.
A potential deal can bolster NXP's capabilities in software-defined vehicles, radar and electrification, as Ambarella develops low-power AI chips and software for edge devices such as cameras, vehicles and robotics.
Discussions are ongoing and might not lead to a transaction, FT said.
NXP declined a Reuters requests for comment, while Ambarella did not immediately respond.
The development comes after NXP forecast quarterly revenue above analysts' estimates on Tuesday, signaling strong demand for its chips in automotive, industrial and data-center markets.
(Reporting by Juby Babu in Mexico City; Editing by Vijay Kishore and Joyjeet Das)
((Juby.Babu@thomsonreuters.com;))
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