Tim Cook addresses Apple’s settlement with Qualcomm, punts on question about 5G iPhones

It didn’t take long for Tim Cook to get asked about Apple’s blockbuster settlement with Qualcomm during its Q2 2019 earnings call. Cook said that Apple is happy to put the litigation behind it.

When asked about the settlement, Cook explained that Apple is “very happy” to have a multi-year chipset supply agreement in place with Qualcomm. Furthermore, Cook said that the direct license agreement portion of the deal was important to both companies in the deal:

We’re glad to put the litigation behind us and that all the litigation around the world has been dismissed and settled. We’re very happy for a multi-year supply agreement and direct license agreement with the Qualcomm, which was important to both companies. We feel good about the resolution.

Cook was then directly asked about how Apple’s settlement with Qualcomm affects its plans for 5G modems in the iPhone. Unsurprisingly, Cook didn’t address 5G in the iPhone directly, but did acknowledge that as new technologies like 5G are expensive, it’s the aggregate of all costs that Apple cares about.

This is one that I’m going to largely punt on, as you can guess. We look at a lot of things on different technologies and try to select the right time that things come together and get those into products as soon as we can.

From a cost point of view, there have been technologies that have had cost pressures over the last couple years. On the flip side, there are a number of things going in the other direction, like DRAM and NAND. It’s difficult to predict what happens next, but the aggregate of it all is what matters from a price point of view.

Last but not least, Apple CFO Luca Maestri was asked for additional color on the financial side of Qualcomm’s settlement. Maestri, however, said that as part of the agreement, Apple and Qualcomm agreed not to share financial details:

As Tim has explained, we’ve reached this compressive agreement. We have agreed that we’re not going to share the financial terms of the agreement. And we plan to honor that. What you see in our gross margin guidance fully comprehends the settlement with Qualcomm.

Read Apple’s full earnings release here. You can listen back shortly after the call with Apple Podcasts.

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Avatar for Chance Miller Chance Miller

Chance is an editor for the entire 9to5 network and covers the latest Apple news for 9to5Mac.

Tips, questions, typos to chance@9to5mac.com