Tech

Broadcom falls on report FTC is looking into the company

Key Points
  • Broadcom has previously disclosed an investigation from the FTC around anticompetitive practices.
  • The chipmaker completed its move from Singapore to the U.S. in 2018.
  • The Trump administration blocked Broadcom's proposed acquisition of Qualcomm for national security reasons.
U.S. President Donald Trump jokes with Broadcom CEO Hock Tan as he announces that Broadcom would be moving back to the U.S. in the Oval Office at the White House in Washington on Nov. 2, 2017.
Nicholas Kamm | AFP | Getty Images

Broadcom shares were down as much as 7% on Monday following a report from Bloomberg indicating the U.S. Federal Trade Commission was looking into the company's tactics around sales of its processors. The stock closed at $272.59, about 6% lower than Friday's close.

Potential regulatory issues further weighed on the stock after Broadcom was already among semiconductor companies trading lower on concern they will no longer be able to sell products to China's Huawei. Last year, the the Trump administration stopped Broadcom's bid to acquire fellow chipmaker Qualcomm.

The federal agency is looking for information that would indicate Broadcom was anticompetitive specifically when it comes to selling data center networking switch and Wi-Fi chips, said Bloomberg, attributing the information to a document and an unnamed individual.

The FTC told CNBC it doesn't confirm the existence of investigations or comment on them. Broadcom declined to comment.

Broadcom said last year that the FTC had sought information from the company, Reuters reported. Months later Broadcom finished the process of re-domiciling from Singapore to the U.S.

CNBC previously reported that Amazon and Hewlett Packard have been on the receiving end of Broadcom's hardball negotiating tactics.

Read the Bloomberg report here.

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