Snapdragon is everything? ARM revokes Qualcomm license amid Nuvia intellectual property lawsuit

ARM has revoked the license that allowed Qualcomm to utilize the company's intellectual property for processor development amid an ongoing legal dispute.

According to a document reviewed by Bloomberg, ARM notified Qualcomm of the cancellation of the licensing agreement for the architecture with a 60-day notice. This contract enables Qualcomm to produce its own chips based on ARM's standards. The conflict threatens to destabilize the market for smartphones and other devices.

Qualcomm sells hundreds of millions of processors annually, which are used in most Android smartphones, tablets, and, more recently, PCs. If the cancellation goes into effect, the company will either have to halt the sale of products that account for a significant portion of its $39 billion revenue or face massive compensation claims for losses.

This action by ARM is a result of a legal battle that began in 2022. ARM filed a lawsuit against Qualcomm, alleging violations of what it believes to be contractual and trademark terms. ARM representatives declined to comment. A Qualcomm spokesperson stated that the British company is attempting to "control a long-time partner":

“It seems like an attempt to derail the legal process; the request for termination is completely unfounded. We are confident that Qualcomm’s rights under the agreement with ARM will be upheld.”

ARM's lawsuit for breach of contract and Qualcomm's counterclaim arose from Qualcomm's acquisition of another ARM licensee in 2021 and ARM's belief that the contract terms needed revision. Qualcomm asserts that the existing agreement covers the activities of the company it acquired, the chip design startup Nuvia.

Nuvia's developments are foundational to Qualcomm's new processors for laptops. Earlier this week, Qualcomm announced plans to transition Nuvia Oryon design into Snapdragon chips for smartphones. ARM contends that this move violates Qualcomm's license, demanding that the company dismantle Nuvia's projects established prior to the acquisition. Nuvia's licenses were terminated in February 2023 following unsuccessful negotiations.

Bloomberg analysts suggest that ARM's action seems to be an attempt to gain leverage ahead of the court hearing on December 16. ARM's lawsuit against Qualcomm will likely end with a negotiated license that grants the chipmaker rights to modify the ARM architecture but with higher royalties than those paid by Nuvia.