This illustration taken on March 6, 2023 shows a smartphone with the Qualcomm logo resting on a computer motherboard.
Dado Luvić | Reuters
Qualcomm Shares fell nearly 5% in premarket trading. bloomberg British chip designer reported arm is trying to revoke key licenses for US companies.
Arm gave Qualcomm 60 days’ notice to terminate the so-called architecture license agreement, Bloomberg reported, citing documents.
The license in question would allow Qualcomm to design chips based on the Arm architecture.
Arm, majority owned by Japanese giant Softbankoperates by effectively licensing the blueprints used by other companies to design semiconductors.
CNBC has reached out to Qualcomm regarding this report. Arm declined to comment.
Qualcomm is one of the world’s largest players in the smartphone processor market. The company’s chips are built into hundreds of millions of smartphones shipped each year.
More recently, the company has stepped up its efforts in the personal computing space with PC processors designed to run artificial intelligence applications.
If the license is revoked, Qualcomm may have to stop selling products based on Arm’s designs.
A Qualcomm spokesperson told Bloomberg that Arm is looking to “strongly strengthen our long-standing partner.” The spokesperson added that this “appears to be an attempt to obstruct the legal process and the dismissal claims are completely baseless.”
The two companies have been engaged in a two-year legal battle centered on Nuvia, an Arm licensee that Qualcomm acquired in 2021. Arm argues that Qualcomm should now renegotiate license terms with the British company.
