Qualcomm renews its chips deal with Apple – analyst Tom Forte’s take
- Apple will continue to use Qualcomm chips in its iPhones.
- D.A. Davidson analyst Tom Forte reacts to the news on CNBC.
- Apple is expected to unveil the all-new iPhone 15 tomorrow.
Qualcomm Inc (NASDAQ: QCOM) is up 5.0% today after announcing a new deal on smartphone chips with Apple Inc (NASDAQ: AAPL).
iPhones will continue to use Qualcomm chips
Copy link to sectionOn Monday, the multinational said Apple will continue to use its 5G modems in its flagship smartphone through 2026.
The iPhone maker was so far expected to switch to an in-house chip as soon as next year. On CNBC’s “Squawk on the Street”, D.A. Davidson analyst Tom Forte said this morning:
It’s taking Apple longer to make those products themselves which basically means it’ll be slower to market more vertically integrated products in the future.
The announcement is significant for Qualcomm considering it brought in 21% of its revenue in fiscal 2022 from Apple Inc. Its shares are roughly flat for the year at writing.
Apple will unveil the iPhone 15 tomorrow
Copy link to sectionQualcomm continues to see a gradual decline in its business with Apple, though. The semiconductor behemoth refrained from updating its guidance today and said its chips will likely power only 20% of the iPhones by 2026.
The news arrives only a day before Apple is slated to unveil the iPhone 15. According to D.A. Davidson’s Forte:
A lot of good news is already baked into the shares … including a very successful iPhone 15 launch. I don’t think the iPhone 15 is going to reignite the stock.
His “neutral” rating on the tech titan comes with a $180 price target – that’s where the stock is already trading. It has come under pressure in recent days after China banned iPhone for government officials (source).
