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Qualcomm Inks Deal With Apple to Supply iPhone Chips

Qualcomm extends deal with Apple!

The agreement comes as Apple has been trying to build its own modem chips to stop using Qualcomm’s

Tweet on Qualcomm deal w/Apple

Axios tweet on Apple chip deal

Qualcomm to supply the iPhone maker with 5G communications chips, the latest sign that Apple’s effort to make them in-house has yet to bear fruit.

The deal suggests that Apple’s long-running effort to develop its own modems isn’t making its way into the company’s flagship phones any time soon. Apple bought Intel’s smartphone modem business in 2019 for $1 billion, bringing on some 2,200 staff members and a portfolio of patents. Intel also had struggled to develop 5G modems and had been losing around $1 billion a year on the operation.

  • Qualcomm said Monday it would supply Apple with the modem chips for smartphone launches in 2024, 2025 and 2026, in a deal with terms similar to a previous arrangement between the companies.

Qualcomm shares rose 3.9% to $110.28 on Monday. Apple shares were up $1.18 to $179.36. Qualcomm didn’t say how much its newest deal with Apple was worth.

Past supply deals have been lucrative for Qualcomm and expensive for Apple. Sales of modems to Apple were about $7.26 billion in Qualcomm’s last fiscal year, or about 16% of its overall revenue, according to a UBS estimate from last month.

Apple has a long record of developing its own technology and reducing its reliance on outside chip vendors. In 2010, it launched its first processing chip for its iPad and iPhone products

 

@thejournalbiz
Source:WSJ/Axios
Image: Apple