Apple has tapped Intel for chip production in a major win for the struggling US semiconductor firm, The Wall Street Journal reported Friday.
Apple, which ships more than 200 million iPhones a year, and Intel, now led by CEO Lip-Bu Tan, have reached a preliminary agreement for Intel to fabricate some of the processors used in Apple devices.
Apple has relied primarily on TSMC to build its custom silicon for years, though it previously split some production between TSMC and Samsung before TSMC became its main manufacturing partner. By 2020, Apple was spending roughly $11 billion a year on TSMC, about a quarter of the foundry’s total revenue.
Intel (INTC) stock jumped 12% intraday to a fresh peak of $123, pushing its valuation to around $620 billion.
Supply constraints and geopolitics
Apple CEO Tim Cook flagged supply constraints during 2025 earnings calls, underscoring how dependent Apple remains on leading-edge chip capacity. That dependence is also a geopolitical risk, since Taiwan sits at the center of global advanced semiconductor production and any major disruptions in the Taiwan Strait could ripple through the industry.
Intel, under Lip-Bu Tan, has been regaining momentum after a difficult 2024, and Washington has even discussed converting CHIPS Act support into an equity stake.
What the deal looks like
Apple and Intel are reportedly targeting the 18A-P process node for the production of entry-level chips. Estimated production volumes are in the range of 15 to 20 million units, with manufacturing potentially starting as early as mid-2027.
Apple is also talking to Samsung, which has a newly built semiconductor facility in Texas backed by a $17 billion investment.
What it means for TSMC and Intel
TSMC posted about $35.9 billion in Q1 2026 revenue, driven by strong AI demand.
While losing 15 to 20 million entry-level chip orders would seem minimal compared to Apple’s revenue base, the strategic issue is that Apple could eventually diversify more of its supply chain away from TSMC if Intel proves capable.
Intel has not previously fabricated Apple-designed chips at scale, and 18A remains a manufacturing risk.
Intel could see a meaningful earnings lift if it wins Apple as a foundry customer, but the payoff depends on Intel proving it can ramp 18A reliably at commercial scale.
