This morning, Imagination Technologies Group released a press statement announcing that Apple Inc. intends to phase out their technology in 15 to 24 months. Imagination has doubts that Apple could have circumvented every piece of intellectual property, and they have requested proof from Apple that their new solution avoids all patents, trade secrets, and so forth. According to Imagination’s statement, Apple has, thus far, not provided that proof, and they don’t believe Apple’s claims.

On the one hand, it makes sense that Apple would not divulge their own trade secrets to their current-partner, soon-competitor until it’s necessary for them to do so. On the other hand, GPUs, based on previous stories, like the Intel / NVIDIA cross-license six years ago, are still a legal minefield for new players in the industry.

So, in short, Apple says they don’t need Imagination anymore, but Imagination calls bull.

From the financial side of things, Apple is a gigantic chunk of Imagination’s revenue. For the year ending on April 30th, 2016, Apple contributed about £60.7 million GBP (~$75 million USD in today’s currency) to Imagination Technology’s revenue. Over that same period, Imagination Technology’s entire revenue was £120.0 million GBP ($149.8 million USD in today’s currency).

To see how losing essentially half of your revenue can damage a company, I’ve included a screenshot of their current stock price (via Google Finance… and I apologize for the tall shot). It must be a bit scary to do business with Apple, given how much revenue they can add and subtract on a moment’s notice. I’m reminded of the iPhone 6 sapphire glass issue, where GT Advanced Technologies took on a half-billion dollars of debt to create sapphire for Apple, only to end up rejected in the end. In that case, though, Apple agreed to absolve the company of its remaining debt after GT liquidated its equipment.

As for Apple’s new GPU? It will be interesting to see how it turns out. Apple already has their own low-level graphics API, Metal, so they might have a lot to gain, although some macOS and iOS applications use OpenGL and OpenGL ES.

We’ll find out in less than two years.