Apple has hit back at its chip supplier, Imagination Technologies after it was accused of unfairly terminating their partnership.
Imagination Technologies blames the iPhone maker for its collapse. Apple, however, claims that it is disappointed in the chip designer for responding in an inaccurate and misleading manner. The UK-based firm claims that Apple gave a short notice of the termination of their partnership. A recent Bloomberg report stated that the firm claims that Apple informed it about ending the partnership in March this year, just days before the announcement about terminating their contract on April 3.
Apple claims that Imagination had Ample time following the notification
Apple told Bloomberg that the claims presented by Imagination were false. The tech giant stated that it gave the chip supplier a heads up about terminating their partnership about two years ago. The iPhone maker claims that it informed the UK-based firm in February that their relationship would reach its end in 2018. This means that it would no longer purchase products from Imagination and it will also stop paying royalty.
“We began working with Imagination in 2007 and stopped accepting new IP from them in 2015. After lengthy discussions we advised them on February 9 that we expected to wind down our licensing agreement since we need unique and differentiating IP for our products,” stated Apple.
Apple also stated that it values the partnership that it has with Imagination and that it wanted to give the company a notice early enough for them to adapt to future plans. Once the news about the partnership between the two firms coming to an end, Imagination’s shares lost as much as 8 percent.
Imagination claims that it signed the multi-year licensing agreement with Apple in 2014 and that the deal had confidentiality clauses preventing any comments that might be detrimental. The company claims that the announcement played a direct role in causing the stock to tank. The two have been working together since 2007 and Apple has contributed roughly 50 percent of Imagination’s revenue. It will be hard for the firm to recover after losing the business that Apple brought.