Apple and Broadcom have extended their chip supply partnership through 2031, expanding an agreement that covers custom radio frequency components, Wi-Fi, Bluetooth, and other networking semiconductors across Apple’s entire product lineup. The extension builds on a multibillion-dollar deal signed in 2023 and underscores a reality that conflicts with Apple’s long-stated ambition to bring chip design entirely in-house: the company will depend on external suppliers for critical wireless technologies for at least five more years.
Broadcom shares rose nearly 4% in premarket trading on the announcement, as per Reuters. Apple represents roughly 20% of Broadcom’s annual revenue, making the company one of its largest customers and granting Broadcom unusual stability within a chipmaker’s typical customer base.
Apple introduced its first in-house cellular modem, the C1, in the iPhone 16E last year. That launch suggested the company was on a path toward complete wireless independence. Yet this five-year extension through 2031 implicitly acknowledges that Apple does not expect to replace Broadcom’s components with proprietary alternatives before then. The next-generation radio chips are expected to debut in the iPhone 18 Pro and iPhone Ultra, but even those devices will apparently not mark a full transition away from Broadcom’s technology.
The deal also suggests Apple learned a lesson from its internal modem efforts. Developing a competitive 5G-capable modem that matches Broadcom’s performance is far harder than designing a system-on-a-chip. Apple’s early modems may be functional, but they are not yet comprehensive enough to eliminate Broadcom’s necessity.
For Broadcom, this extension is a validation of its technical moat. Despite Apple’s relentless vertical integration push across nearly every other semiconductor category, Broadcom has managed to remain indispensable. That reflects both the complexity of radio frequency engineering and Broadcom’s entrenched position as a specialist in this domain.
The market’s positive reaction reflects relief: investors in Broadcom can now model revenue from one of its largest customers with confidence for another five years. For Apple, the deal acknowledges that independence in wireless chips takes longer than in-house modem releases might suggest.
