SAN FRANCISCO — Apple said on Thursday that it would buy most of Intel’s smartphone-modem business for $1 billion, aiding its push to gain more control over faster wireless technology in iPhones.
Apple will add about 2,200 Intel employees, as well as patents and equipment. The deal is expected to close in the fourth quarter and is subject to regulatory approval.
Analysts say Apple will develop a 5G iPhone by late next year. Those iPhones are expected to use chips from Qualcomm, another chip maker that, until recently, was in a legal fight with Apple over royalties and other business practices.
But after that, the business being acquired from Intel will allow Apple to reduce its dependency on Qualcomm.
An iPhone capable of running on 5G networks, which offer speeds far faster than current wireless connections, could have big implications. A 5G iPhone could push the spread of such networks across the globe and encourage the adoption of new technologies that run on 5G, such as industrial robots, security cameras, drones and cars.
The transaction also gives Apple its first major portfolio of wireless patents, giving it leverage in future licensing negotiations with Qualcomm and other patent holders.
In April, Apple and Qualcomm settled a yearslong legal dispute. Although the companies are now on better terms, Apple has long sought to take more control over the critical parts inside of its devices.
Gene Munster, a longtime Apple analyst and a partner at the investment firm Loup Ventures, said that given Apple’s enormous cash pile, about $225 billion, the deal was a smart move for Apple.
“It makes a ton of sense, given that they ultimately want to replace Qualcomm’s chips and this is the fastest path to that,” he said.
Qualcomm is Intel’s main competitor in the business of smartphone modems, which are critical chips that help phones connect to wireless networks.
For Intel, the transaction ends a long-running saga of missteps in mobile phone technology that began in the late 1990s. The company tried and failed initially to become a major supplier of chips that provide computing functions in phones, as it does in personal computers.
Then Intel shifted its focus to compete in so-called baseband modems, chips that manage cellular communications in phones. That effort began in earnest after it announced a deal in 2010 to purchase Infineon’s wireless chip business for $1.4 billion.
That company had supplied baseband chips for the first iPhones but later lost that business to Qualcomm. Intel later won it back amid Apple’s legal squabbles with Qualcomm over patent royalties.
Intel never made money on baseband chips and showed little chance of doing so after Apple and Qualcomm settled their differences. Robert Swan, named Intel’s chief executive in January, announced plans to exit the business the same day.
Apple is acquiring Intel operations that employ 4,000 people in Munich, Germany; Linz, Austria; and San Diego, Calif. Intel said it was trying to retain or find external jobs for as many of those employees as possible.
Intel announced the transaction along with second-quarter financial results, which were better than analysts had predicted. The company’s shares jumped 6 percent on the news in after-hours trading.