Background
According to a Wall Street Journal report, Apple is evaluating alternatives to Taiwan Semiconductor Manufacturing Company (TSMC) for the fabrication of certain lower‑end processors.
- TSMC’s capacity is increasingly allocated to Nvidia and other AI‑focused customers.
- Apple aims to diversify its supply chain and reduce reliance on a single foundry.
Potential Intel Partnership
While no specific partner was named, industry rumors point to Intel as a likely candidate.
- Analysts Jeff Pu and Ming‑Chi Kuo project Intel could start supplying chips for non‑Pro iPhone models as early as 2028.
- Intel’s 18A process may be used for Apple’s lowest‑end M‑series chips for select Mac and iPad models beginning mid‑2027.
- The partnership would focus solely on fabrication, not chip design.
Impact on Apple Products
If the deal materializes, Apple could see the following changes:
- Potential A21 or A22 chips for future iPhone models manufactured by Intel.
- Lowest‑end M‑series processors for certain Macs and iPads produced on Intel’s 18A node.
- No shift in iPhone chip architecture; Apple would retain its in‑house ARM‑based designs.
Supply‑Chain Diversification Benefits
Partnering with Intel would give Apple a strategic backup as TSMC’s AI‑server demand grows.
- Reduces risk of bottlenecks caused by TSMC’s allocation to Nvidia and other AI firms.
- Provides leverage in negotiations over RAM and NAND pricing, where Samsung and SK Hynix have gained influence.
Market Context and Financial Implications
Apple’s recent earnings show strong performance despite rising memory‑chip costs.
- Q4 revenue hit $143.8 billion, up 16% YoY.
- Gross margin projected at 48‑49% for the current quarter.
- CEO Tim Cook noted “minimal impact” from memory‑chip price hikes but expects a slight margin effect.
Future Outlook
Analysts expect Apple’s iPhone 18 lineup to avoid price increases, while the potential Intel partnership could set the stage for a more resilient, cost‑effective supply chain in the coming years.