Apple Secures Long-Term 5G Modem Supply from Qualcomm

Qualcomm has announced that it will supply Apple with 5G modems for iPhones through 2026, contrary to previous expectations that Apple would develop its own 5G modem by 2024. This continued partnership will benefit Qualcomm's handset business, which reported $5.26 billion in sales in Q2 2023, and help offset the potential loss of a critical customer. Approximately 21% of Qualcomm's fiscal 2022 revenue came from Apple. While Apple has been working on building its own modems, analysts believe it will be challenging for the company to move away from Qualcomm's chips due to their complexity. Qualcomm also collects royalties from Apple under a six-year agreement that was settled in 2019.