KGI: 2018 iPhones will feature faster pre-5G baseband chips from Intel and Qualcomm, with 70%-80% of chips coming from Intel
A new report today from KGI shares projections that the 2018 iPhones will include significantly faster baseband chips from Intel and Qualcomm, although Intel will be the main supplier.
Context & Ripple Effects
Intel has been building toward this since winning its first contract to supply modem chips for some iPhones in 2016, and KGI's new projection marks the payoff: faster pre-5G baseband chips in the 2018 iPhones, with Intel taking 70%-80% of the volume and Qualcomm relegated to the remainder. That split lands mid-litigation — Qualcomm has already said publicly it believes Apple intends to move entirely to a competitor's modems, likely Intel's.
First-order effects
- Intel becomes the majority modem supplier for the 2018 iPhone lineup, displacing Qualcomm from the dominant position it held in earlier generations.
- Qualcomm's iPhone modem share shrinks to roughly 20%-30%, cutting into the device volumes that underpin its chip sales while its patent dispute with Apple continues.
Second-order effects
- KGI's split-supplier projection gives weight to Qualcomm's claim that Apple is preparing to drop its modems entirely, raising the stakes in the licensing fight that Qualcomm says is driving Apple toward Intel exclusivity.
- If Apple follows through on single-sourcing, Intel gains the scale to push its modem roadmap toward standalone 5G silicon, as later reports of an Intel-only 8161 modem iPhone suggest.
Third-order effects
- Apple's sourcing pattern here — dual-sourcing as leverage, then tilting toward one supplier during litigation — shows baseband orders functioning as a bargaining tool, a structure that persisted until Apple swung back to Qualcomm's X55 modem across all three 2020 iPhones.
- For modem vendors, the lesson of the arc from Intel's entry through the expected Intel-only 5G iPhone is that Apple will fund a second supplier precisely to avoid dependence on any one chip partner.
The trend: Apple's smartphone modem supply is being restructured by its legal war with Qualcomm, swinging between dual-sourcing and near-single-sourcing as both sides position for 5G.