Intel Signs Preliminary Deal to Make Chips for Apple

Apple and Intel have struck a preliminary deal for Intel to produce chips for upcoming Apple devices, as reported by The Wall Street Journal on Friday. This marks a surprising reunion between the two companies that separated in 2020.

A Surprise Reunion

This feels like a tech déjà vu because it kind of is. Apple used Intel processors for around 15 years before making a major shift in consumer tech. In 2020, Apple started transitioning its Mac computers to custom-designed chips known as Apple Silicon. These in-house processors have been a big hit, with the M1, M2, and M3 offering impressive performance and battery life improvements compared to their Intel predecessors.

So, why is Apple returning? The key factor is manufacturing rather than design. Reports suggest this deal involves Intel making chips for Apple, not Apple going back to Intel-designed processors. It’s similar to a restaurant that creates its own recipes but hires a different kitchen to prepare them.

What Intel Brings to the Table

Intel has been ramping up its contract chip manufacturing business, called Intel Foundry Services. This division makes chips for other companies, much like how Taiwan’s TSMC produces chips for Apple, Nvidia, and others. Landing Apple as a client would greatly enhance Intel’s credibility in the foundry market. It would also signal to the industry that Intel’s manufacturing capabilities are strong enough for one of the most demanding chip customers.

Currently, Apple relies heavily on TSMC for chip production. Adding Intel to the mix would lessen Apple’s reliance on a single supplier, which has become increasingly important for tech companies after recent supply chain disruptions.

What This Means

For everyday Apple users, this deal probably won’t change much on the surface. Your next MacBook or iPhone won’t suddenly sport “Intel Inside” like before. Apple will likely keep designing its own chips. However, where those chips are manufactured might change, which could lead to more stable supply chains. This means fewer product shortages and could create competitive pressure on TSMC that might affect pricing and production schedules.

For Intel, this deal is quite significant symbolically. The company has been striving to regain its reputation as a chip manufacturer after lagging behind TSMC and Samsung in production technology. Securing a contract from Apple, known for its selective supplier choices, would send a strong message across the industry.

Community Reactions

“Intel manufacturing Apple’s chips is actually huge for Intel Foundry. If they can land Apple, every other fabless company will take notice.”

“People keep saying this means Intel CPUs are coming back to Macs. No. Apple designs the chips. Intel just builds them. Completely different thing.”

Still Early Days

It’s important to highlight that this agreement is still preliminary. Deals like this can fall apart, be restructured, or take years to yield actual products. Neither Apple nor Intel has publicly confirmed the deal yet. The report from The Wall Street Journal is credible, especially regarding Apple’s supply chain, but until chips are actually rolling off Intel’s production lines for Apple devices, we’re still in the negotiation phase.

Sources that have covered this story include 9to5Mac, The Verge, and Engadget.

What To Watch

• Official confirmation: Keep an eye out for either Apple or Intel to acknowledge the deal during earnings calls or in press releases. Apple’s next earnings call seems like a likely venue.
• Which products: Reports haven’t clarified whether this deal involves Mac chips, iPhone chips, or something else. That detail is crucial for understanding the scope of the agreement.
• Intel Foundry progress: Intel has publicly targeted 2026 and 2027 for its most advanced manufacturing nodes. Hitting those timelines is key for ensuring Apple’s chips can meet the required standards.
• TSMC’s response: If Apple is genuinely diversifying chip production away from TSMC, expect a response from TSMC — possibly in the form of pricing adjustments or capacity commitments to keep Apple on board.