Intel Stock Surges 14% on Unconfirmed Apple Chip Manufacturing Deal
Intel shares jump 14% on reported preliminary deal with Apple to produce chips; move could reshape foundry market and reduce Apple's TSMC reliance.
Intel Stock Surges 14% on Unconfirmed Apple Chip Manufacturing Deal
Intel Corporation shares skyrocketed nearly 14% in after-hours trading following reports that the chipmaker has secured a preliminary agreement with Apple Inc. to produce processors for select Apple devices. The deal, which sources say was finalized in recent months after more than a year of negotiations, marks a potential breakthrough for Intel's foundry business as it seeks to challenge industry leader TSMC.
According to The Wall Street Journal, the contract covers the manufacturing of chips for future Apple products, though specific devices were not disclosed. Apple has long relied on TSMC for its custom silicon, but geopolitical tensions and supply chain risks have pushed the tech giant to diversify its manufacturing partners.
“This is a watershed moment for Intel's foundry strategy,” said Dan Hutcheson, principal analyst at TechInsights. “Winning Apple — even for a portion of its business — validates Intel's advanced process technology and could open the door to other major clients.”
Background
Intel has been aggressively shifting toward a foundry model under CEO Pat Gelsinger, investing billions in new fabrication plants in the U.S. and Europe. The company aims to regain process leadership and offer manufacturing services to external customers, including former competitors like Apple.
Apple transitioned its Mac line from Intel processors to its own M-series chips starting in 2020, but still uses custom silicon for iPhones, iPads, and other devices. A manufacturing relationship with Intel would represent a strategic pivot for Apple, which has historically kept its chip production largely within TSMC’s ecosystem.
The reported deal comes as Intel’s foundry services unit faces stiff competition from TSMC’s 3-nanometer and 2-nanometer processes. However, Intel has claimed its Intel 18A node will surpass industry standards by 2025, potentially making it an attractive partner for advanced chip production.
What This Means
If confirmed, the agreement could have far-reaching implications for the semiconductor landscape. For Intel, it provides a high-profile customer that can boost revenue from its foundry division and build credibility in the contract manufacturing market. For Apple, it offers a second source for critical components, reducing reliance on a single supplier amid ongoing geopolitical uncertainties between the U.S. and Taiwan.
“Diversification is key for Apple, especially with chip supply being a bottleneck for many years,” said Jane Yao, semiconductor analyst at Gartner. “Intel gives them a domestic alternative that aligns with U.S. efforts to reshore advanced manufacturing.”
However, the deal is still in its preliminary stages and could face technical hurdles, including process validation and yield rates. Investors should watch for official announcements from either company in the coming weeks.
Intel closed the trading day at $X.XX per share, up 13.9% on the news, reflecting market optimism. Shares of TSMC dipped slightly on the report, signaling worries about losing a flagship customer.
Both Apple and Intel declined to comment. This story is developing and will be updated as more details emerge.