China's State Administration for Market Regulation (SAMR) has launched an antitrust investigation into U.S. semiconductor giant Qualcomm (NASDAQ: QCOM) over its acquisition of Israeli vehicle communication chipmaker Autotalks, alleging that the company failed to lawfully declare certain details of the transaction as required under Chinese law.

In a statement issued on Friday evening, October 10 (Beijing time), the regulator said Qualcomm's acquisition "was not declared in accordance with the Anti-Monopoly Law of the People's Republic of China," prompting a formal case filing.

The move marks Qualcomm's second major antitrust probe in China, following a 2015 case that resulted in a $975 million fine for abuse of market dominance.

Deal Under Scrutiny

Qualcomm completed its purchase of Autotalks in June 2025, integrating the Israeli firm's vehicle-to-everything (V2X) communication technology into its Snapdragon Digital Chassis platform. V2X enables direct communication between vehicles and surrounding infrastructure to improve road safety and traffic efficiency.

Founded in 2008, Autotalks develops chips supporting both DSRC and C-V2X (LTE-V2X and 5G-V2X) standards and has been deeply involved in China's connected vehicle ecosystem. The company participated in China's 2019 "Four-Cross" C-V2X interoperability demonstrations in Shanghai, working alongside over 20 automakers and suppliers, including Chinese and international OEMs.

Autotalks also signed a strategic partnership with Neusoft and was awarded mass-production projects by eight automakers, including two Chinese manufacturers, to equip V2X-enabled vehicles for both domestic and European markets. These deep local engagements explain why Qualcomm's acquisition required Chinese regulatory approval, even though Autotalks is an Israeli company.

Strategic and Geopolitical Implications

Analysts view the probe as part of China's broader regulatory scrutiny of U.S. chipmakers and a reflection of escalating technology tensions between the two countries.

"China could have issued a no-harm warning, but the choice to escalate to a formal investigation signals stronger pressure on U.S. chip and automotive supply chains," said Stephen Wu, founder of Carthage Capital.

The investigation comes just a month after SAMR accused NVIDIA of violating China's antitrust law related to its Mellanox acquisition, and days after Beijing announced new export controls on rare earths and related technologies used in 14nm-and-below logic and high-density memory chips.

Market Reaction and Context

Qualcomm's shares fell more than 4% following the announcement, as investors weighed the potential impact on the company's automotive ambitions and its heavy exposure to China—46% of Qualcomm's fiscal 2024 revenue came from customers headquartered in China, including major handset makers like Xiaomi.

The timing also coincides with renewed trade and technology friction ahead of a planned meeting between U.S. President Donald Trump and Chinese President Xi Jinping at the APEC Summit later this month in Gyeongju, South Korea.

"Qualcomm's Autotalks acquisition positions it strongly in the future of connected vehicles," said Parth Talsania, analyst at Equisights Research. "But the investigation amplifies investor concerns about geopolitical and regulatory risk at a time when semiconductor trade has become a key battleground in the U.S.–China AI race."

Possible Outcomes

If SAMR concludes that Qualcomm violated Chinese law, the company could face financial penalties or structural remedies, such as divestiture of part of Autotalks' China operations.

The case underscores China's growing determination to enforce domestic competition laws while maintaining leverage in its strategic competition with the United States over advanced chip technologies.

As China standardizes V2X technology nationwide by 2026, the outcome of this investigation could shape the competitive landscape of next-generation intelligent vehicle communications—and further test Qualcomm's ability to navigate complex global regulatory terrain.