Qualcomm to Pay Huawei for Patents for the First Time in Broad 5G and AI Cross-License

Huawei and QCOM announced on October 5 a multi-year, broad patent license agreement that includes cross licenses to both companies' portfolios across 5G, compute, AI and networking, together with Qualcomm's purchase of certain Huawei U.S. patents. The notable shift is the direction of payment: Qualcomm has agreed to pay to license and acquire patents from Huawei for the first time, reversing a relationship in which Huawei has paid Qualcomm for cellular standard-essential patents since 2001.

Bloomberg reported that the patents Qualcomm is licensing include those underpinning LogicFolding, Huawei's chip-design technique that folds circuitry vertically to shorten signal paths and improve performance without the most advanced manufacturing nodes, and described the deal as a win that helps validate Huawei's chipmaking push abroad. Huawei's chief IP officer Alan Fan said the agreement "demonstrates the value of Huawei's innovations," while Qualcomm EVP John Han said it "reaffirms industry recognition of Qualcomm's 5G technology leadership." No term length beyond "multi-year" and no financial terms were disclosed, and closing requires regulatory approvals.

For Qualcomm, the deal adds freedom to operate in AI, compute and networking as it expands beyond handsets, at an undisclosed cost. For Huawei, it is a commercial endorsement of its patent portfolio at a time when U.S. export controls limit its access to advanced chipmaking tools. What to watch: whether U.S. regulators scrutinize a U.S. chipmaker paying a sanctioned Chinese company, any disclosure of the payment in Qualcomm's filings, and whether other chipmakers sign similar licenses for Huawei's packaging and design patents.