Is Apple About To Ditch Qualcomm Chips?

Apple iPhone 8

Apple's Hardware Partnership With Qualcomm Is Unraveling

San Francisco: Escalating its longstanding dispute with chipset maker Qualcomm over licensing fees and patents, iPhone maker, Apple is reportedly designing products for 2018 that will not feature chips by Qualcomm.

The penalty imposed by Taiwan in October was Qualcomm's third since 2015, fallout from a wave of global regulatory challenges to the company's business practices. According to The Wall Street Journal, Qualcomm is withholding testing software from Apple's future devices.

Net income attributable to the company fell to $168 million, or 11 cents per share, in the fourth quarter ended September 24, from $1.60 billion, or $1.07 per share, a year earlier.

In Q4 2016, Qualcomm reported revenues of $6.2 billion on earnings per share of $1.07.

Qualcomm and Apple have been embroiled in a legal battle over patents since January, when the latter filed a suit against Qualcomm of around $1 billion.

Sales of chips for mobile devices rose 13%, continuing their steady growth in recent quarters.

We asked Qualcomm for a statement, but the company declined to comment on the speculation that Apple may stop using its chips.

Regulators in some countries, meanwhile, have determined Qualcomm uses its dominant position in chips to thwart competitors and charge exorbitant royalties, bringing fines and demands that the company change its business practices. The $39 billion deal has been held up by European regulators, though, and some NXP owners are holding out for a higher price.

Qualcomm shares, down 18 percent this year, were little changed in trading after the bell on Wednesday.

The spat between Apple and chipmaker Qualcomm just keeps getting nastier and nastier, and apparently Apple may finally have had enough of it.

The San Diego, Calif., chip maker reported per-share earnings of 92 cents on an adjusted basis, omitting share-based compensation and other items. The company announced a almost 90 percent drop in profits, while revenue fell 4.5 percent.

For the entire fiscal year, Qualcomm reported net income of $2.47 billion, or $1.65 per share, compared to $5.7 billion, or $3.81 per share in the previous year.

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