The stock was rising 13.1% to $17.42.
No final decision has been made on a potential sale, according to the Bloomberg report, and Cypress could choose to remain independent. But it is considering a deal, according to the news service's sources.
Adding pressure to the company is the recent acquisition of Quantenna Communications (QTNA) - Get Report by Cypress rival ON Semiconductor (ON) - Get Report . The move is designed to help bolster ON's position in the automotive chip industry.
Shares of ON were rising 2.9% on Wednesday.
Cypress shares have risen 36% year to date and Wednesday's spike brought the stock back up to levels it was trading at before a post-earnings slump earlier this month resulted in a 10% dip.
The San Jose-based company reported an adjusted 5.5% decline in first-quarter revenue, though it did forecast a revenue increase of 4.4% for the current quarter.