Qualcomm prepares for Apple breakup as modem deal nears end
After over 15 years powering iPhones with its modem chips, Qualcomm appears to be preparing for life beyond Apple. Speaking on Yahoo Finance’s Opening Bid podcast, Qualcomm CEO Cristiano Amon confirmed that the chipmaker is planning its business under the assumption that Apple will not renew its modem supply contract beyond 2027.
“We’re planning our business assuming that they are going to use their own modem,” Amon said. “And what’s exciting about the company is all of this growth that we’re creating, all of those other markets, including on Android.”
Costly Partnership Nearing Its End
Apple has been one of Qualcomm’s biggest clients. In 2024 alone, analysts estimate that Apple paid more than $2.5 billion in patent licensing fees, with Qualcomm’s modem revenue from Apple reaching between $5.7 billion and $5.9 billion. However, Apple’s efforts to develop an in-house modem have been gaining pace, culminating in the launch of the C1 chip earlier this year in the iPhone 16e.
Although the C1 offers better power efficiency, it does not support mmWave, a key 5G technology used in the US, limiting its deployment. Nonetheless, Apple is doubling down, with plans to include the chip in the upcoming iPhone 17 Air and reportedly working on an upgraded C2 modem.
Qualcomm Shrugs Off Apple Dependency
While Apple still has a valid modem contract with Qualcomm until March 2027, Amon appeared unconcerned about the potential end of the relationship. “That’s our contract,” he said. “And if we don’t get a new contract, that’s what it is.”
Interestingly, Amon’s comments come just weeks after Qualcomm released a study, funded by the company, comparing Android phones with Snapdragon modems to Apple’s C1. The study claimed Android devices offered better connectivity, though critics noted the methodology appeared tilted in Qualcomm’s favour.
Despite this, Amon downplayed any drama between the two tech giants, saying that the “association about the Apple relationship…is not warranted.”
Looking Beyond Smartphones
With its Apple contract likely nearing its final years, Qualcomm is diversifying its roadmap. The company is exploring chips designed to connect to Nvidia’s AI processors and investing heavily in Android, where its modem and SoC business continues to grow.
“We’ve seen incredible traction on Android,” said Amon, pointing to Qualcomm’s strong position across global handset makers as evidence of resilience post-Apple.
While Apple moves toward modem independence, Qualcomm is banking on its Android partners, and AI-driven opportunities, to drive the next phase of growth.
