UK-based Imagination Technologies has announced that Apple has signed up to a new multi-year licensing agreement for the use of its intellectual property. The announcement might come as a surprise to some - in the wake of the shock news in April 2017, when Apple stated it was phasing out use of Imagination's IP in its iPhone and iPad products, as it was developing its own GPUs.
Imagination's press release today was very brief, so I have included it in full below:
London, UK; 2nd January 2020 – Imagination Technologies ("Imagination") announces that it has replaced the multi-year, multi-use license agreement with Apple, first announced on February 6, 2014, with a new multi-year license agreement under which Apple has access to a wider range of Imagination’s intellectual property in exchange for license fees.
If we hark back to the disastrous news for Imagination back in April 2017 (its share price dropped 70 per cent on the day), we can see that Apple stated it wouldn't need the third party tech anymore (within 15 to 24 months) as it would be using its own in-house GPU. At the time Imagination was enjoying >£60m p.a. in royalty payments from Apple. It reacted in disbelief with regard to Apple's claims.
A couple of months after the Apple licensing announcement, the plot thickened as Apple opened an office for GPU development near the Imagination Tech HQ in the UK. It looked like some kind of underhand take-over strategy was in play. However, IMG was bought up and taken private in September the same year by a Chinese-backed investment firm by the name of Canyon Bridge Capital. The buyout fee was £550m - at its peak in 2012, IMG's market value had approached £2bn.
Over more recent years / months we have seen that Imagination has continued to innovate and push forward with its GPU launches and tech advancements. Perhaps it is this work, with products like the recently announced 10th Gen A-Series GPUs (see graphic above), that has earned it a reprieve and the award of steady continuing royalty income from Apple.