Apple and Qualcomm extend 5G chip partnership until 2026
What's the story
Apple has inked a new deal with Qualcomm to supply 5G chips for iPhones until at least 2026, extending their partnership after settling a legal battle in 2019.
The San Diego-based firm, a leading designer of modem chips, will provide Apple with processors for its annual phone releases.
The deal's value remains undisclosed, with Qualcomm stating the terms are "similar" to their previous agreement.
Details
Legal dispute resolved, chip supply continues
Qualcomm and Apple had been embroiled in a legal dispute over patent licensing fees since 2017, which was resolved in 2019 with a chip supply agreement.
Under this agreement, Qualcomm provided modem chips for iPhones, but it was supposed to end this year.
Apple is set to announce new iPhones tomorrow (September 11), marking the last handset debut under the current agreement.
The legal battle prompted Apple to explore developing its own modem technology.
What Next?
Qualcomm's modest projections for iPhone market share
Qualcomm estimates that only 20% of Apple's iPhones will utilize its chips by 2026.
However, the company made a similar projection for 2021 that proved overly conservative, as all iPhone 14 models released in 2022 utilized Qualcomm modems.
These financial projections assume Apple will increase the usage of its own modem technology, which it has been developing since acquiring Intel's modem unit for $1 billion in 2019.