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
This KGI note extends an arc that began when Intel first won a contract to supply modem chips for some iPhones in 2016, breaking Qualcomm's incumbency in the iPhone. A year later, KGI projects the split swinging decisively toward Intel — 70%-80% of 2018 baseband chips — while both vendors move to faster pre-5G silicon.
The projection lands mid-dispute: by July 2018, Qualcomm said it believed Apple intended to source modems solely from Intel, making this report a snapshot of Apple tilting its dual-source structure toward one supplier just before the 5G transition.
First-order effects
- Intel's modem business scales from minority supplier to roughly three-quarters of the 2018 iPhone baseband volume, while Qualcomm's share contracts to 20%-30% during the ongoing patent litigation between the two companies.
Second-order effects
- With Apple leaning on Intel, follow-on reporting pointed to Intel's 8161 chip powering a 2020 iPhone with Intel as likely sole modem supplier — raising the stakes of Intel's roadmap delivering 5G on Apple's schedule.
Third-order effects
- Sole-sourcing exposed Apple to a single vendor's execution risk; when later reports showed all three 2020 iPhones using Qualcomm's X55 5G modem, the pattern suggested Apple treats modem supply as a lever to rebalance whenever one supplier's roadmap or pricing slips.
The trend: iPhone modem sourcing is oscillating between dual-sourcing and near-single-supplier bets as Apple positions itself for the 5G transition.