Apple ditches its graphics chip maker, Imagination Technologies. The British Firm, Imagination Technologies made graphic chips for smartphone dominator, Apple. Apple gave Imagination Technologies a notice that they will stop buying and using their technology in two years. It could be a major blow for the British firm, and it can even drop its revenue by 50 percent.
Shares of Imagination Technologies plunged by 65%. Apple holds 8% of Imagination Technologies shares. Imagination Tech. Informed that Apple is developing its graphic processing chips. Henceforth, they predict that it will reduce Apple’s reliance on their firm. Apple is currently the biggest customer of Imagination Technologies.
The firm licenses its processing designs to Apple and receives a small share on every graphic chip used in Apple’s products.
Imagination Technology’s Words
However, Imagination Tech informed that they doubt Apple to go and get it alone without violating Imagination’s intellectual property and confidential information.
Imagination said on Monday that they requested Apple for the evidence however they declined to provide it. They stated that Apple’s notification triggered talks on the alternative commercial arrangement for current license and royalty engagement.
Imagination informed that Apple paid them royalties and license fees of 60.7 million pounds for the year to end April 2016. It was half of the total revenue of Imagination. Imagination expects to receive about 65 million pounds this year from Apple.
If what Imagination just unveiled, people will see an A-series chip with both entirely designed Apple CPU and GPU with next release from Apple. Apple already found success in the field of CPU design with ARM-based processor cores. Although, the particulars of any new GPU design are likely to come.