Arm Holdings to cancel Qualcomm chip design license

Amid an ongoing legal battle, Arm Holdings is cancelling an architectural license agreement that allows Qualcomm to use intellectual property to design chips. Arm has given Qualcomm a mandated 60-day notice of the cancellation of the licensing agreement. The contract allowed Qualcomm to create its own chips based on standards owned by Arm. UK-based Arm sued Qualcomm in 2022 for failing to negotiate a new license.

The dispute originates from Qualcomm's 2021 acquisition of Nuvia, a chip firm, which Arm alleges broke their agreement by failing to renegotiate the license. Arm had earlier sued Qualcomm in 2022 and revoked Nuvia's licence for its chip designs, which Arm claims are used in Microsoft's future Copilot+ notebooks.

Qualcomm reacted forcefully, with a spokespeson describing the licence cancellation as ‘more of the same from Arm—more unfounded threats designed to strongarm a long-time partner’ and ‘an attempt to disrupt the legal process’ ahead of the December trial.

Qualcomm believes that its rights under the agreement are protected and that Arm's termination suit is ‘baseless.’

The termination of the architectural licence could have serious repercussions for Qualcomm. If Arm wins the action, Qualcomm and its partners, including Microsoft, may be obliged to suspend shipments of new laptops equipped with Qualcomm chips. This would put at risk Qualcomm's commercial plan while also disrupting its partnerships with big technology companies such as Microsoft.