Qualcomm Wins Decisive Victory Over Arm in Chip War: What Does This Mean for the Industry ?

Qualcomm Snapdragon 865/© Qualcomm

The American giant Qualcomm can breathe easy: a federal jury in Delaware has just ruled in its favor in the conflict that opposes it to British company Arm.

This decision represents a major step forward for Qualcomm, which will be able to continue developing its processors for laptops and artificial intelligence.

A multi-billion dollar battle

At the heart of this trial is a dispute between the two semiconductor giants following a buyout operation. In 2021, Qualcomm acquired the startup Nuvia for $1.4 billion. This strategic operation aimed to propel Qualcomm into the race for next-generation processors, particularly for Windows PCs and AI applications. But Arm, which provides the basic architecture for designing the chips, has challenged the legality of the deal, arguing that Qualcomm was using Nuvia's intellectual property without permission.

The stakes were high: Arm was threatening to revoke Qualcomm's license, which could have crippled a large portion of its business, worth nearly $39 billion in annual revenue. Tensions escalated in October 2024 when Arm sent a 60-day notice to terminate Qualcomm's architectural licensing agreement.

After more than nine hours of deliberation, the jury ultimately ruled that Qualcomm's processors are properly covered by its agreement with Arm. This decision therefore clears the way for the commercialization of chips developed with Nuvia technology, a key part of Qualcomm's strategy to conquer the PC market.

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The financial markets reacted immediately: Qualcomm shares jumped nearly 3%, while Arm's shares fell as many points. Bernstein analysts called the outcome a “clear victory for Qualcomm”, though some questions remain.

The Future of the Processor Market

This legal battle takes a new turn as the processor market is undergoing one of its biggest transformations. The emergence of artificial intelligence and the growing demand for more powerful PCs have reshuffled the deck. Qualcomm, historically dominant in the mobile sector, is seeking to diversify its activities into the personal computer market, traditionally dominated by Intel and AMD.

Nuvia technology represents a major asset for Qualcomm in this diversification strategy. The first processors integrating this technology are already under development, with renowned partners such as HP and Microsoft planning to integrate them into their next generations of laptops optimized for AI.

For its part, Arm does not intend to give up and is requesting a new trial for the “unresolved points”. The British company, which supplies the basic architectures to almost the entire mobile industry, actually takes a dim view of potential competitors emerging on its playing field.

The request for a new trial could reignite hostilities, but analysts believe that both companies would benefit from finding common ground, their collaboration being essential for innovation in the sector.

• Qualcomm wins partial victory allowing development of its chips based on Nuvia technology to continue
• Jury validates legality of Qualcomm licenses but does not decide on all issues in the dispute
• Arm announces its intention to request a new trial on unresolved points

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