Thanks to our industry’s venerable leaker Ming-Chi Kuo, the debate has once again heated up on Apple’s transition to using Apple Silicon on the modem. Apple has tried and failed numerous times to do this, a topic that Moor Insights & Strategy chief analyst Patrick Moorhead and I have discussed repeatedly over the years. This topic has been covered so thoroughly that I find myself wanting to talk about it less every time it comes up. The last time was in September 2023, when Qualcomm announced that it would be extending its modem supply agreement with Apple into 2026.
The Latest Developments
According to Kuo, Apple will adopt its own modem chips in 2025, beginning with the iPhone SE in the first quarter of the year. This will be followed by the iPhone 17 Slim (which Kuo is calling the Ultra-Slim) in Q3 of 2025, which coincides with the typical iPhone launch schedule. This means that Kuo believes Apple will test its new modem in a low-cost and a low-volume platform (the iPhone SE) early next year. This also means that Apple will continue predominantly shipping Qualcomm modems in the iPhone 17 and iPhone 17 Pro series, likely giving Qualcomm a significant share of iPhones in 2025. That said, the iPhone SE is very popular device outside of the U.S., and using an in-house modem in it should help with margins on that device.
My Analyst Take
What’s going largely unsaid in discussions of this rumor is that Apple will (allegedly) ship its modem in second-tier iPhones rather than going straight to the moneymaker end of its product line. This is a logical approach, because Apple is effectively proving this new modem on lower-cost, lower-volume parts to ensure that if there are any delays or technical issues, they won’t affect Apple’s quarterly revenue or cadence. I believe that if this launch happens and is successful, Apple will likely pivot to 100% Apple Silicon 5G modems in 2026 for the iPhone 18.
One other aspect to consider here is mmWave support, which Apple currently has with Qualcomm’s 5G modems using Apple’s in-house mmWave modules. It is so far unclear whether Apple’s 5G modem chips will support mmWave—and whether the company will build iPhones with mmWave support at all. The one carrier that would most want that capability is Verizon, whose 5G UW network is a blend of 3.6-GHz mid-band and mmWave high-band transmission. The iPhone 15 series supports mmWave in the U.S. because of Verizon, but it remains unclear if Apple will continue to support it if the company starts using its own modem chips in later generations.
Apple’s Long-Term Strategy
I believe that Apple’s long-term strategy with its 5G modems is to build them into as many devices as possible. Why? Because connected devices run more services, and if you can ensure fast connectivity everywhere all the time, you can offer more services—and make more money. There are probably also better chances of bundling services, devices, and connectivity for a single simple monthly price, which I believe is the end goal.
There are some follow-on ramifications of this. Somewhere down the line, we could also see new 5G modems from Apple for wearables that utilize RedCap (reduced capacity) to maximize battery life and minimize power consumption. But I believe that’s something we might not see for a few more years. Plus, Apple might want to initially use a vendor for this to test the viability of RedCap; MediaTek and Qualcomm both already have RedCap modems, and the versatility and power efficiency of those components could be very attractive for the Apple Watch and potentially any XR wearables from Apple. The only issue is that RedCap modems require a 5G standalone network, which many of the carriers have dragged their feet on deploying. That said, 5G SA will deliver the true 5G experience consumers have long wanted; perhaps Apple will be one of the drivers for bringing 5G SA to the masses faster.
