Dialog Semiconductor Agrees to Strengthen Partnership with Apple Through Technology Licensing Agreement

Dialog Apple partnership
Image: Dialog

Dialog Semiconductor has agreed to strengthen partnership with Apple to license certain of its power management technologies, transfer certain of its assets and over 300 employees to Apple to support chip research and development.

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Dialog plans to rapidly become a market-leading provider of differentiated custom and configurable mixed-signal ICs across a broader customer base in fast-growing segments of the IoT, Mobile, Automotive and Computing & Storage markets. The market served by Dialog such as power conversion, connectivity, audio and charging ICs is expected to grow at a 13% CAGR to reach $13 billion by 2021. Dialog will continue to deliver PMICs to other customers globally, said a press release.

“This transaction reaffirms our long-standing relationship with Apple, and demonstrates the value of the strong business and technologies we have built at Dialog. Going forward, we will have a clear strategic focus, building on our custom and configurable mixed-signal IC expertise and world-class power-efficient design. Our execution track record, deep customer relationships, and talented employees give us great confidence in our future growth prospects,” said Jalal Bagherli, CEO of Dialog.

“We believe that this transaction is in the best interests of our employees and shareholders who will benefit from a business with enhanced focus, strong growth prospects and additional financial flexibility to invest in strategic growth initiatives,” he added.

This agreement will not affect Dialog’s 2018 revenue. The company will continue shipments of current products in production to Apple. The proceeds from the transaction further strengthen Dialog’s balance sheet, enabling the company to accelerate investments – including M&A – in growth opportunities across IoT, Mobile, Automotive and Computing & Storage markets.

Dialog Apple partnership
Image: Creative commons

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“Dialog has deep expertise in chip development, and we are thrilled to have this talented group of engineers who’ve long supported our products now working directly for Apple,” said Johny Srouji, Apple’s senior vice president of Hardware Technologies. “Our relationship with Dialog goes all the way back to the early iPhones, and we look forward to continuing this long-standing relationship with them.”

These are the terms of the agreement:

  • Dialog will receive $600 million for the license of certain power management integrated circuits (PMICs), transfer of certain assets, and prepayment for future product purchases by Apple
  • Apple will employ over 300 of Dialog’s talented engineering team to support future R&D
  • Dialog will be awarded a broad range of new contracts from Apple for the development and supply of power management, audio subsystem, charging and other mixed-signal ICs
  • Dialog will sharpen its focus on fast-growing segments of the Internet of Things (IoT), Mobile, Automotive and Computing & Storage markets as a leading provider of custom and configurable mixed-signal ICs
  • Dialog announces intent to initiate share buyback program of up to 10% of its outstanding shares following its Q3 trading update

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Cathy Russey
Cathy Russey () is Online Editor at WT | Wearable Technologies and specialized in writing about the latest medical wearables and enabling technologies on the market. Cathy can be contacted at info(at)wearable-technologies.com.