Huawei announced on Monday that it has reached a broad, multi-year patent license agreement with Qualcomm covering 5G, computing, artificial intelligence, and networking technologies.
Under the deal, the two companies will cross-license their respective patent portfolios. In addition, Qualcomm will purchase certain Huawei patents in the United States covering computing, AI, networking, and other technologies. The transaction will close once the necessary regulatory approvals are obtained. Financial terms were not disclosed.
This is Huawei's first patent-licensing agreement with Qualcomm that covers 5G technology. It is also the first under which Huawei licenses and assigns patents in computing, AI, and networking to the U.S. chip designer, according to the Chinese company.
Huawei Chief Intellectual Property Officer Alan Fan said the agreement "not only demonstrates the value of Huawei's innovations, but also recognizes Qualcomm's foundational contributions to modern communication technologies." Qualcomm's John Han, executive vice president and general manager of Qualcomm Technology Licensing, said the deal "reaffirms industry recognition of Qualcomm's 5G technology leadership and the success of Qualcomm's 5G SEP licensing program," while also reflecting "Qualcomm's recognition of Huawei's continued innovation and intellectual property in 5G and other technology fields."
Huawei said the deal is expected to push the total contract value of its patent licensing agreements beyond $6.9 billion. The company's intellectual property licensing business has generated positive revenue since 2021, reflecting years of heavy investment in research and development. Since the United States imposed trade restrictions in 2019, Huawei has been cut off from advanced chips and key software and has ramped up its own R&D spending, turning patent licensing into a significant revenue stream.
The history between the two companies has come full circle: Huawei's first-ever intellectual property licensing payment went to Qualcomm, back in 2001, while its first IP licensing income came from Motorola in 2011. In August, Huawei announced a Wi-Fi patent cross-licensing deal with HP. Bloomberg reported that the Qualcomm agreement also includes licenses to patents underpinning Huawei's LogicFolding chip technology.
Against the backdrop of continued U.S. sanctions, the deal underscores that Huawei remains a top patent holder in information and communications technology. For Qualcomm, securing access to Huawei's 5G and computing patents bolsters its 5G standard-essential patent licensing program. Both companies said the agreement reflects their commitment to intellectual property rights and to licensing practices consistent with fair, reasonable, and non-discriminatory (FRAND) principles.