Jun 22, 2017

Apple chip dispute proves too great a stretch of Imagination

Smartphones, tablets, connected TVs. All of these could claim to be the greatest innovations of the 21st. And that makes it hard not to feel sorry for Imagination Technologies - which has lost £468m in value despite patenting its chips for these devices. In April, Imagination learned that Apple - by far its biggest customer - would stop using its graphics chips in new iPhones and iPads. Shares in Imagination - which relied on Apple for more than half its £120m annual sales - fell 61 per cent, cutting its market capitalisation to just £292m. On Thursday, with a dispute resolution process still no nearer resolution, Imagination formally put itself up for sale. Among the most mentioned were: global chipmakers Intel, MediaTek, CEVA and Qualcomm, which could benefit from Imagination's complementary graphics know-how; Chinese tech investors such as Tsinghua and JAC Capital, which want more western assets; Japan's SoftBank, which bought UK chip designer ARM and has billions more to spend; and Google, which is . Their original mistake was to think Apple's 8 per cent stake in Imagination meant it would not walk away.

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