Qualcomm agrees to license and buy Huawei patents in 5G and AI deal

Huawei first paid Qualcomm to license its patents in 2001. On Monday the two companies signed a deal that also runs the other way: a multiyear cross-license covering 5G, computing, artificial intelligence and networking, plus Qualcomm's purchase of some of Huawei's U.S. patents.

The two companies announced the agreement from Shenzhen, with comments from executives on both sides. Each gets licenses to the other's patent portfolio across 5G, computing, AI and networking. Separately, Qualcomm will buy certain Huawei U.S. patents in computing, AI, networking and other technologies. That purchase has not happened yet: the transaction will close once the necessary regulatory approvals are received, the companies said.

They disclosed no financial terms. They did not say which patents Qualcomm is buying, how many there are, or how long the license runs beyond calling it multi-year. Both said the deal follows fair, reasonable and non-discriminatory (FRAND) licensing principles. Huawei said it is its first patent license with Qualcomm to cover 5G, and the first under which it licenses and assigns patents in computing, AI and networking to the U.S. chip designer.

Who pays whom

That is the question the announcement leaves open. Nikkei Asia reported that the deal, if approved, would make Qualcomm the net payer between the two for the first time, and that Huawei said Qualcomm will pay to use more than 680 patents, some of them registered in the U.S. Neither company has confirmed which way the money flows or how much.

Each side's statement credits the other. "This agreement reaffirms industry recognition of Qualcomm's 5G technology leadership and the success of Qualcomm's 5G SEP licensing program," said John Han, executive vice president and general manager of Qualcomm Technology Licensing, referring to the standard-essential patents that phone makers license to build 5G devices. Alan Fan, Huawei's chief intellectual property officer, said the deal "not only demonstrates the value of Huawei's innovations, but also recognizes Qualcomm's foundational contributions to modern communication technologies."

A license that had lapsed

The two have fought over royalties before. In July 2020 Qualcomm settled a dispute with Huawei and signed a long-term global patent license that included a cross license granting back rights to certain Huawei patents. Qualcomm said at the time that it expected about $1.8 billion in revenue from the settlement and from amounts due for the March and June 2020 quarters.

That arrangement ran out. Qualcomm's annual report for fiscal 2025 says its licensing revenue stopped including royalties from Huawei in the quarter that ended in March 2025, because the license had expired. Its chip sales to Huawei had ended earlier: in May 2024 the Commerce Department revoked the export license under which Qualcomm sold Huawei 4G and certain other chips, and Qualcomm says it expects no further product revenue from the company. Monday's announcement does not mention chip sales or export licenses. It is a patent deal.

Why Washington is involved

Huawei has been on the Commerce Department's Entity List since May 2019, when the U.S. government said it had reasonable cause to believe the company had been involved in activities contrary to U.S. national security or foreign policy interests. U.S. trade restrictions since then have limited Huawei's ability to buy advanced chips and crucial software.

The companies did not name the regulators that must sign off or give a timetable. Nikkei's report said the deal's value would exceed $133.9 million, this year's minimum size at which a transaction generally has to be reported to U.S. antitrust authorities under the Hart-Scott-Rodino Act, which would bring a U.S. antitrust review.

LogicFolding and the gap with TSMC

The licensed patents reach beyond phones. A Huawei spokesperson told Bloomberg Law that the cross-license also spans near- and co-packaged optics, which connect chips through optical links, and the publication reported that Qualcomm is licensing patents on LogicFolding, the chip architecture Huawei unveiled in May.

Huawei's semiconductor chief, He Tingbo, presented LogicFolding at an industry conference in Shanghai on May 25. The design expands a chip's layout from one layer to two, and Huawei said that by 2031 it could deliver capabilities equivalent to 1.4-nanometer process technology without the extreme ultraviolet lithography machines China cannot obtain. TSMC has said it will begin mass production at that level in 2028. Huawei said its Kirin phone chips launching this fall would be the first to use the architecture.

Outside analysts were cautious. "A stacked/folded design can produce effective density gains, but it does not mean Huawei has solved the full process, yield, power, thermal, and device-performance problems associated with true 1.4 nm-class manufacturing," Paul Triolo of DGA Group said in May. A patent license is not a performance test. If Qualcomm is paying for access, that shows a rival chip designer sees value in Huawei's portfolio; it does not show that LogicFolding chips can match TSMC's.

A growing licensing business

Huawei's own licensing income began with Motorola in 2011. The company said that, counting the Qualcomm deal, the total contract value of its patent licensing agreements now exceeds $6.9 billion. That figure covers all of its licensing deals, not this one alone. The Qualcomm agreement follows a Wi-Fi patent cross-license Huawei reached with HP in August.

Qualcomm shares were up about 3% in thin premarket trading early Monday, at roughly $190, against Friday's close of $184.87.