This is a multi-dimensional announcement, as it means that Apple is likely to use Qualcomm modems until that date, and more importantly, it will use the licensing from Qualcomm's technology licensing (QTL) group. Even if Apple creates its own 5G modem, we still believe it will need to continue using Qualcomm's license even beyond this date. Modems are exceptionally hard, and Intel and Apple are proving us right. Apple still doesn't have its in-house solution after five+ years of 5G with Snapdragon and a few others.

“Apple exercised its unilateral option to extend its global patent license agreement for an additional two years, taking the existing agreement through to March 2027.”

Fiscal 2024 is particularly important for Qualcomm, as the company is driving an impressive PC effort with a CPU core that outperforms Apple's best M3, which is scheduled to launch later in the year. Automotive is growing, and there is a big incentive for XR growth now that Apple has entered the virtual/augmented reality market with its over-expensive product.

Apple is known for being late to the market. Still, as with tablets and watches, it tends to generate a lot of interest, resulting in a spike in developers' interest in both Apple and the competition's ecosystem.

Based on previous experiences, Apple will spike the interest in the XR market and enable growth for other players such as Meta or Xreal and a few others, where Qualcomm plays a significant role.

Long-term players are paying off, and the Wall Street guys are reacting positively.