NEW YORK (REUTERS) - US communications giant Qualcomm Inc is expected to conduct a strategic review that may result in the breakup of the company, among other options, the Wall Street Journal reported on Monday, citing sources.

The company has been under pressure from hedge fund Jana Partners to spin off its chip business from its highly profitable patent-licensing business. In addition, EU antitrust regulators are investigating whether Qualcomm uses illegal tactics to shut out rivals, six years after slapping a record 1 billion euro fine on Intel for a similar offence.

The chipmaker may announce that it is considering that and other options - including returning more cash to shareholders, when it reports third-quarter results on Wednesday, sources told the Journal. However, there is no guarantee of such an announcement as the company's plans are in flux, they added.

The news comes after reports earlier on Monday that Qualcomm is preparing to lay off several thousand employees.

Qualcomm could not be immediately reached for comment outside regular U.S. working hours. The company's shares were up about 3.2 per cent in after-hours trading after closing at US$63.79 on the Nasdaq on Monday.

Qualcomm, which reported a 46 per cent drop in second-quarter profit in April, is facing increasing competition from Taiwan's MediaTek Inc and a handful of small Chinese companies that specialize in making chips for low-priced phones.

Qualcomm could shift more research and development activities to low-cost countries such as India for further cost savings, the Information website reported on Monday, citing one person.

It forecast third-quarter revenue and profit below analysts' expectations in April, saying the loss of a key customer and delays in product launches by some smartphone makers will hurt sales of its flagship Snapdragon chips. Longtime customer Samsung Electronics opted this year to use an internally developed processor for its new Galaxy S6 smartphone and Note rather than Snapdragon chips.