In the midst of an ongoing legal dispute between the two businesses, media outlets reported on Tuesday that Arm Holdings is terminating an architectural license deal that permits Qualcomm to use intellectual property to manufacture processors.
According to the source, Qualcomm has been granted a 60-day notice period by Arm to terminate the licensing deal. The agreement permits Qualcomm to develop its own processors using Arm-owned standards.
In 2022, Qualcomm was sued by UK-based Arm, which is primarily owned by Japan’s SoftBank Group, for not negotiating a new license following its acquisition of Nuvia.
Arm had previously stated that the license for these chips had been revoked and that the new design intended for Microsoft’s Copilot+ laptops is a direct technical descendent of Nuvia’s chip.
“This is more of the same from ARM—more unfounded threats designed to strongarm a long-time partner, interfere with our performance-leading CPUs, and increase royalty rates regardless of the broad rights under our architecture license,” a Qualcomm spokesperson said in a statement.
“With a trial fast approaching in December, Arm’s desperate ploy appears to be an attempt to disrupt the legal process, and its claim for termination is completely baseless. We are confident that Qualcomm’s rights under its agreement with Arm will be affirmed. Arm’s anticompetitive conduct will not be tolerated.”
In December, the federal court in Delaware is set to start the legal battle between the two internet giants.
Qualcomm and about 20 of its partners, including Microsoft, might be forced to stop shipping the new laptops if Arm wins the lawsuit. Additionally, it would effectively close out one of Qualcomm’s most significant strategic acquisitions in the previous few years.
Even though the two businesses that depend on one another for income and profit are engaged in a public dispute, some analysts and investors think a resolution will be reached long before the trial.
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