Apple Inc. has struck a deal to license chip technology from Imagination Technologies Group Plc, a British semiconductor designer that had a public falling out with the iPhone maker in 2017 over graphics processing units.

Hertfordshire-based Imagination revealed the news in a terse press release issued today. “Imagination Technologies (“Imagination”) announces that it has replaced the multi-year, multi-use license agreement with Apple, first announced on February 6, 2014, with a new multi-year license agreement under which Apple has access to a wider range of Imagination’s intellectual property in exchange for license fees,” the company stated.

Imagination develops semiconductor designs that it doesn’t manufacture on its own but rather licenses to other companies. The firm’s business model is in this respect similar to that of fellow British chip designer Arm Holdings Plc, whose technology is also employed by Apple. Imagination’s silicon architectures are used to make GPUs, image processors for mobile cameras and wireless communications chips.

Under the original deal with Imagination back in 2014, Apple adopted the British firm’s designs as the basis of the GPUs inside both the iPhone and the iPad. The 2019 models are believed to employ Imagination-based graphics chips as well, but that’s not officially confirmed since the two companies’ relationship soured in April of 2017. 

The falling-out was prompted by Apple’s announcement that month it would start developing a homegrown GPU with the goal of “reducing its future reliance on Imagination’s technology.” The news sent the British firm’s crashing more than 70%.

Imagination responded by triggering the dispute resolution clause in its contract with Apple and even hinted it might launch a patent infringement lawsuit, but the feud eventually cooled off. The company ended up selling itself to private equity firm Canyon Bridge Capital Partners later in 2017 for 550 million pounds, which was the equivalent of about $740 million at the time. 

The new licensing agreement revealed today will likely provide a significant source of revenue for Imagination in the years ahead. Apple was Imagination’s single largest customer when their dispute broke out, accounting for the bulk of the firm’s licensing income.

The deal also sheds some light on Apple’s chip development roadmap. When the iPhone maker declared in 2017 that it wished to become less reliant on Imagination, it indicated that a new, replacement GPU would be rolled out within 24 months. The project apparently didn’t meet all the goals Apple had set out, judging from the newly announced licensing agreement. 

Apple has been trying to reduce its dependence on external chip partners for quite some time now. Among other options, it’s said to working toward replacing the Intel Corp. processors inside its Mac computers with homegrown Arm-based silicon. 

Photo of Apple CEO Tim Cook: Apple