Shares of the mobile tech company Qualcomm (NASDAQ:QCOM) tumbled 13% in January, according to data provided by S&P Global Market Intelligence, after investors learned that Qualcomm decided against letting its modems be used in Apple's (NASDAQ:AAPL) latest iPhones. It was previously believed that Apple was the one that decided not to use the tech.
Shares of Qualcomm were flat for the first half of January before they fell off a cliff thanks to testimony from Apple COO Jeff Williams. Williams said in a Federal Trade Commission trial that the iPhone maker was planning on ordering modems from both Intel and Qualcomm for its latest iPhone lineup, but that Qualcomm wouldn't allow Apple to buy the modems.
Qualcomm and Apple have been embattled in a long-standing legal dispute over licensing fees that Qualcomm charged Apple, and the lawsuit evidently boiled over into the modem deal between to the two companies. "We were working toward doing that with Qualcomm, but in the end, they would not support us or sell us chips ... We would have loved to continue to have access to Qualcomm's tech," Williams said during the trial.
Qualcomm investors were understandably upset about this news and immediately pushed the company's share price down.
Check out the latest Qualcomm earnings call transcript.
Qualcomm's stock has rebounded a bit this month and is up about 4% so far. The share price bump follows the company's most recent quarterly earnings results, which were released on Jan. 30. But despite the share price uptick, there's a lot of uncertainty about Qualcomm's licensing fee business and questions about its overall business model.