Apple pays Arm less than 30 cents per chip: Report

Apple licenses the underlying technology used in the chips that power the iPhone, iPad, Mac, Apple Watch, Apple TV, and HomePod from Arm. The Cupertino-based tech giant reportedly represents less than five per cent of Arm’s annual revenue despite being the chip designer’s biggest and most important customer. The iPhone maker also reportedly pays Arm the least among all the other smartphone chip customers. According to a report by The Information, Apple pays the UK-based chip architect a flat fee of less than 30 cents in royalties for each chip used in its devices, regardless of how many cores it has. The report also notes that the revenue that Arm generates from Apple is around half the figure for each of the chip designer’s top two customers, Qualcomm and MediaTek.

In 2017, Arm-parent SoftBank’s CEO explained to Arm executives that Apple pays more for the plastic that is used to protect the screens of new iPhones than it does to license Arm’s intellectual property.