Chip manufacturer Qualcomm confirmed in a conference call on Wednesday that it does not believe Apple, with whom it has been locked in a vicious, escalating court battle over royalties and patents since 2017, will use its modems in its next generation of iPhones.
Per CNN Money, Qualcomm Chief Financial Officer George Davis told analysts on the call that they believe Apple intends to switch to competitors, leaving Intel as the only likely supplier for upcoming iPhone models:
“We believe Apple intends to solely use our competitor’s modems rather than our modems in its next iPhone release,” CFO George Davis said on a conference call with analysts Wednesday. “We will continue to provide modems for Apple legacy devices.”
Qualcomm (QCOM) makes most of its money licensing smartphone radios and chips, and Apple is one of its biggest customers... Apple did not immediately respond to a request for comment. Intel declined to comment.
CNN Money added that Qualcomm again confirmed it was abandoning efforts to scuttle a $44 billion acquisition of the Netherlands-based NXP Semiconductors and instead pursue stock buybacks of up to $30 billion.
Apple originally exclusively used Qualcomm modems for iPhones, per CNET, but as the two companies’ legal war continued it began using Intel chips in somewhere around half of iPhones rolling off production lines. A switch to Intel could complicate efforts to meet demand on new products, and as CNET added, Intel’s chips are reportedly significantly slower than Qualcomm ones:
A report from Speedtest app maker Ookla earlier this week showed that Android phones using Qualcomm modems were faster than Intel-powered phones — iPhones — on the same networks. On T-Mobile, for instance, Android smartphones using Qualcomm’s Snapdragon 845 downloaded data 53 percent faster than phones using Intel’s XMM 7480 chip and 68 percent faster than Intel’s XMM 7360 modem.
Apple has been facing some occasional quality issues like malfunctioning thermal throttling in MacBook Pros, crappy keyboards, and throttled iOS devices for a while now, and slower mobile data performance than competitors in future iPhones could in theory become a point of future contention. That said, it is pure speculation whether the next iPhone will in fact have slower connectivity than rivals using Qualcomm chips or whether the difference would be significant enough to tell.
Other reports have variously suggested Apple could be switching to MediaTek instead of Intel, the latter of which rumors suggest may also lose its business selling Apple wifi and Bluetooth chips. (Intel-Apple breakup rumors have always been rampant, though usually concerning processors.) Yet more esoteric rumblings have emerged concerning a possible switch to Apple-made chips as part of CEO Tim Cook’s desire to own all parts of the supply chain, though that’s really more of a long-term stretch goal.
According to CNN Money, Qualcomm stock prices rose on news of the buyback, though the long-term prospects for the company in light of its failed acquisition remain unclear.