For most of the smartphone era, patent money between Huawei and Qualcomm has moved, on balance, in one direction. The Chinese company built phones and network equipment on wireless standards that Qualcomm helped write, and paid Qualcomm to use its inventions. On Monday the two companies announced a deal that, on the accounts given in China and reported by Nikkei, reverses that for the first time.
The agreement, announced from Shenzhen, is a multi-year cross-licence: each company may use the other's patents across 5G, computing, artificial intelligence and networking. On top of that, Qualcomm is buying some of Huawei's American patents in computing, AI, networking and other technologies. That purchase will close only after regulators approve it.
Neither company disclosed what is being paid. But China Daily, the state-owned newspaper, described it as the first revenue-positive agreement Huawei has signed with Qualcomm, and the first between them to cover 5G. Nikkei reported that Qualcomm will become the net payer, 25 years after Huawei first paid Qualcomm for a licence, and that the deal is large enough to need review under the US merger-notification threshold of $133.9 million, according to a summary by the market research firm TrendForce.
What Qualcomm is buying
According to Nikkei's reporting as summarised by TrendForce, Qualcomm will pay to use more than 680 Huawei patents, some of them registered in the US. Bloomberg reported that they include patents covering LogicFolding, a Huawei approach to chip and system design that, Reuters reported, is used in its latest Kirin smartphone processors.
The statements from both sides were careful to give each other credit. "This agreement not only demonstrates the value of Huawei's innovations, but also recognizes Qualcomm's foundational contributions to modern communication technologies," said Alan Fan, Huawei's chief intellectual property officer, who singled out Huawei's work on polar codes, a method of encoding signals used in 5G.
John Han, who runs Qualcomm's licensing business, said the deal "reaffirms industry recognition of Qualcomm's 5G technology leadership and the success of Qualcomm's 5G SEP licensing program", referring to patents that are essential to the 5G standard. It also, he said, "reflects Qualcomm's recognition of Huawei's continued innovation and intellectual property in 5G and other technology fields."
A customer Qualcomm already lost
Qualcomm used to sell Huawei chips as well as licences. That ended in May 2024, when the Commerce Department revoked the export licence under which it had been selling Huawei 4G and other chips. In its latest quarterly filing Qualcomm says it does "not expect to receive any further product revenues from Huawei", and warns that Huawei phones taking market share from Qualcomm's customers could hurt it further.
The patent purchase now adds a different kind of exposure. Washington has been restricting what American companies may sell to Huawei since 2019, and is weighing new tariffs on imported chips. Neither company said which agencies must approve Qualcomm buying Huawei's US patents, or when they expect to close.
The deal comes as Qualcomm's licensing arm has stalled. Its QTL division, by far its highest-margin business, took in $1.28 billion in the quarter to June, down 3 per cent from a year earlier, which the filing attributed mainly to fewer estimated sales of devices using its technology. Its pre-tax margin was 69 per cent. Over nine months, licensing revenue was up 2 per cent, at $4.25 billion.
Qualcomm's shares closed at $180.79 on Monday, down 2.2 per cent.
Huawei's licensing business
For Huawei, which received its first licensing income in 2011 after settling a dispute with Motorola, according to CGTN, the deal is a milestone in a business it has been building for years. It says licensing has been revenue-positive since 2021, that it has signed more than 270 licence agreements with manufacturers in the US, Europe, Japan and South Korea, and that it held more than 165,000 active patents at the end of 2025. In August it announced a licence with HP Inc.
Once the Qualcomm transaction is completed, Huawei told China Daily, the total value of its patent licensing agreements is expected to exceed $6.9 billion. It has not said how much of that comes from Qualcomm.
The terms of the agreement and the quotations from Alan Fan and John Han are from Huawei's announcement of 5 October 2026. Huawei's description of the deal as its first revenue-positive and first 5G licence with Qualcomm, its patent and R&D totals, the HP agreement and the $6.9 billion figure are from China Daily (5 October 2026), citing the company; its first licensing revenue in 2011 is from CGTN (5 October 2026), citing Huawei. Nikkei's reporting on net payments, the number of patents and the review threshold, Bloomberg's on LogicFolding and Reuters' on the Kirin processors, are as summarised by TrendForce (5 October 2026). That neither side disclosed who pays is from Yahoo Finance (5 October 2026). The 2024 licence revocation and the QTL and QCT segment figures are from Qualcomm's quarterly report on Form 10-Q for the period ended 28 June 2026. Qualcomm's share price is its Nasdaq close via Yahoo Finance; the percentage change is this publication's calculation. Accurate to 5pm ET on 5 October 2026.
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