Imagination Technologies whose PowerVR GPUs were once found inside Apple’s A-series chips is struggling to stay afloat as the royalties it receives from Apple continue to decline. The company is looking for a further cash injection from its Chinese owners.
Apple used Imagination Technologies PowerVR GPUs in its A-series chips until it launched the iPhone X in 2017 with the A11 Bionic chip when it switched to its in-house GPU.
Apple’s reduced reliance on Imagination Technologies spelled trouble for the U.K.-based chip maker. Right in 2017, Imagination Technologies put itself up for sale. While Apple was in acquisition talks with the chipmaker, Imagination Technologies was ultimately acquired by a Chinese funded company known as Canyon Bridge Capital.
Since then, things have not really looked rosy for the British company as it has struggled to stay afloat. In 2018, its earnings from royalties fell from £83.3m to £71.5m. In the same year, Apple accounted for £45.3m of total revenues for Imagination Technologies.
As sales of older Apple products dwindle, the Cupertino company’s royalties to Power Imagination will continue to decline further.
“The continuing uncertainty over Imagination’s relationship with Apple, and the level of cash receipts that will be received in the future from Apple, may result in the company requiring financial support from Canyon Bridge,” it said.
Since its acquisition, Canyon Bridge has infused Imagination Technologies with £35m in funding and has promised further cash infusion as required.
We have not seen Imagination Technologies PowerVR GPU inside chips from other chip makers. Due to this, the company’s survival chances look very bleak. It would have to rapidly win over clients and design GPUs for major chipmakers to help stay afloat.
[Via The Telegraph]