The British firm that supplied the designs for Apple’s graphics chips is up for sale, less than three months after the maker of the iPhone said it would no longer use those designs and would instead come up with its own. That announcement was made public by the firm, Imagination Technologies, on April 3.
Imagination’s stock crashed nearly 70% on the day the news hit, and the stock has traded roughly in that range ever since.
But today the stock shot up about 17% as investors were told of a possible sale. The company said it had received interest from several buyers, and so would start a formal sale process today.
All told, there were just 81 days between the news that Apple planned to stop using Imagination’s designs and today’s sale announcement. One analyst, Neil Wilson of ETX Capital, summed it up for the Guardian: “A pretty ignominious end to what was a great British tech success story.”
Imagination’s fall is a startling reminder of the clout firms of Apple’s stature command in the technology market, and the risks of over-reliance on them. Over 40% of Imagination’s revenues were derived from Apple.
When a firm makes a living in the shadow of giants, there is always the danger of being crushed.