The deal will allow Apple to license graphics and video microchip designs for future models.
Apple has extended its GPU licensing deal with chip designer Imagination Technologies, which would allow the iPhone maker to add PowerVR chips to its mobile devices.
The latest multi-year deal will let Apple license graphics and video microchip designs, and covers licensing and pay royalty fees on each of the system-on-a-chip (SoC) Imagination’s intellectual property, which are manufactured by Apple supplier Foxconn.
The agreement ends speculation that the iPhone maker would ditch the UK group and consult rival ARM or its own technology instead.
Apple’s A7 SoC, which powers its latest iPhone 5S and iPad Air, is based on a PowerVR chip as its GPU component, accompanied by ARM’s 1.4 GHz, 64-bit dual-core CPU.
Imagination’s designs and patents are also licensed to other firms including Texas Instruments, Intel, NEC, BlackBerry, Samsung and Freescale.
Apple reported flat profits of $13.1bn during the October 2013 to January 2014, and posted record quarterly revenue of $57.6bn, which the company put down to weaker than anticipated sales of its iPhone 5C version.