Broadcom is talking with advisers about a potential deal, which would be the biggest ever takeover of a chipmaker. A final decision on whether to proceed has not been made, they said.
Shares of Qualcomm surged roughly 15% on the news, while Broadcom's stock climbed more than 3%.
Avago paid $37 billion in cash and stock for Broadcom.
Broadcom, which has a market value of $110 billion, just announced on Thursday that it's moving its headquarters to the USA from Singapore.
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The reports came one day after Tan held a news conference with President Trump to announce that Broadcom, now based in Singapore with a primary US office in San Jose, plans to move its corporate domicile to the United States.
Qualcomm declined to comment.
Broadcom was created a year ago when Tan's Avago Technologies Ltd. bought Irvine-based chipmaker Broadcom Corp. for $37 billion and then adopted the Broadcom name for the combined company. However, Apple may ditch Qualcomm altogether and develop future iPhone and iPad units that rely only on Intel modems, which would drastically affect Qualcomm's bottom line. Reports surfaced this week that Apple was considering eschewing Qualcomm chips entirely in its iPhones and iPads beginning next year in what would a major blow for the San Diego-based chipmaker.
This comes at a time when Qualcomm itself is trying to complete a $47 billion purchase of NXP Semiconductors. The deal is facing regulatory examination in Europe and opposition from some shareholders including activist hedge fund firm Elliott Management Corp., which has argued the offer undervalues NXP. The two companies are already among the top 10 providers of chips in an industry that's consolidating rapidly.