Apple escalates Qualcomm battle


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Consequently, Apple’s the contractors won’t be able to pay Qualcomm which means there will be a hit to Qualcomm’s Q1 revenues.

Instead of Qualcomm Q1 revenues of an estimated $5.3 billion – $6.1 billion these will now be $4.8 billion – $5.3 billion.

With Samsung, Apple accounts for 40% of Qualcomm’s sales revenues.

Apple doesn’t pay royalties directly to Qualcomm but reimburses its contractors for the cost of royalty payments which the Apple contractors pay to Qualcomm.

The mechanism by which Qualcomm acquires royalties from different players in the mobile supply chain is extremely complex and Apple issued this diagram to help make some sense out of it:

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