Sydney
Qualcomm, a prominent designer of modem chips, has announced a new deal with Apple to supply 5G chips for the tech giant’s iPhones until at least 2026. This agreement follows a prior supply deal established in 2019, which was reached after both companies settled a prolonged legal dispute. The initial chip supply arrangement is set to expire this year, making the forthcoming iPhones the last to debut under that agreement.
Under the terms of the newly announced deal, Qualcomm will furnish Apple with chips for iPhones scheduled for release each year until 2026. While specific financial details remain undisclosed, Qualcomm stated that the terms resemble those of the previous agreement. Furthermore, the patent licensing deal inked between Qualcomm and Apple in 2019 will continue, with an expiration date in 2025 and the option for a two-year extension.
Apple has been working on developing its own modem technology, having acquired Intel’s modem unit in 2019 for $1 billion. However, Apple has not yet provided details about the timeline for incorporating its own modem chips into its products. Qualcomm has projected that, by 2026, only a fifth of Apple’s iPhones will use its chips. Nevertheless, it’s worth noting that Qualcomm made a similar projection for its business with Apple in 2021, which turned out to be overly conservative, as all iPhone 14 models released the following year used Qualcomm modems. This latest deal reaffirms Qualcomm’s position as a key supplier for Apple’s iPhone lineup and solidifies their ongoing collaboration in the highly competitive smartphone market.
