Along with the other things they sold that don't seem so smart now. Like abandoning the low power x86 Geode processor in 2009. Interestingly, according to this article [1] they sold Adreno for only $65 million, less than IT is making from Apple each year in royalties.
That may be true but unlike Adreno, you know Apple does not resell any of the patents to anyone else, so it always stay contained to Apple's products. Given how much revenue they can take, it's a very tempting business agreement.