Qualcomm is facing an existential risk

Not only is Qualcomm facing significant challenges from the collaboration between Intel and AMD in the laptop chip segment, but it is also at risk of losing ground in the smartphone chip market after Arm terminated their technology agreement.

Recently, the two companies have been engaged in a tense legal dispute. The issue dates back to 2021 when Qualcomm acquired Nuvia for $1.4 billion. Nuvia is a startup founded by former Apple employees. From this acquisition, Qualcomm developed a range of chips with Oryon cores that have achieved numerous breakthroughs, designed for both smartphones and laptops.

However, Arm argues that Qualcomm is not permitted to use Nuvia’s technological advancements without Arm’s consent. According to Arm, the agreements it had with Nuvia included certain incentives due to its startup status, but after Qualcomm’s acquisition of Nuvia, the company no longer retained its "startup" nature, and thus, the terms of the agreement should be amended.

Meanwhile, Qualcomm’s key chip products have relied on Arm’s architecture. Therefore, if Qualcomm is indeed unable to use Arm’s architecture, the entire Snapdragon chip platform could potentially cease production. Currently, Qualcomm’s Snapdragon chips are integral to most Android smartphones and many laptops that incorporate artificial intelligence (AI) technology in collaboration with Microsoft.

Should Qualcomm be forced to stop supplying Arm-based chips, it would impact the product launch plans of numerous smartphone brands like Samsung, Oppo, Xiaomi, and more. Likewise, laptop manufacturers such as Dell, HP, Asus, Lenovo, and Microsoft would also be affected, especially with their AI Copilot+ laptops that integrate Qualcomm’s Snapdragon X Plus and X Elite chips.

All of this indicates that the current risks associated with Arm could become a "critical blow" to Qualcomm. And as always, while waiting for more exciting news, remember to use our comparison tool to find the best deal for your next favorite game.