Intel Shares Surge on Reported Apple Chip Manufacturing Deal

CNBC reported Friday that Apple and Intel have reached a preliminary agreement for Intel to manufacture some chips destined for Apple devices. The news sent Intel shares up nearly 14% in a single session. Apple stock added around 2%. Both companies declined to comment on the report.

A Watershed Moment for Intel’s Foundry Business

The Intel Apple chip deal would represent the strongest external validation yet of Intel’s long-struggling contract manufacturing operation. For years, Intel’s foundry unit endured production delays, poor yields, and a near-total absence of outside customers. Chip analyst Ben Bajarin of Creative Strategies told CNBC he is fully convinced the deal will eventually close. He described Intel as now “validated as a credible second source” following a difficult transition period. Intel shares have climbed more than 200% so far this year.

Why Apple Is Looking Beyond TSMC

Apple currently sends all of its most advanced chip orders to Taiwan Semiconductor Manufacturing Company, making it the foundry giant’s second-largest customer behind Nvidia. However, soaring AI-driven demand has pushed TSMC’s wafer capacity to its limits. Apple has aggressively expanded its own silicon design programme in recent years, covering processors across iPhones, Macs, and other devices. That growing volume needs a reliable second supplier. Bajarin told CNBC that Intel is the only company capable of scaling up capacity to fill that role meaningfully.

Intel’s New Arizona Plant and the Road Ahead

Intel is now running high-volume production at a new fabrication facility in Chandler, Arizona, using its 18A process node. That node is designed to compete directly with TSMC’s 2nm technology, currently produced only in Taiwan. Bajarin cautioned that Apple is likely to wait for Intel’s next-generation 18A-P node, which he expects to reach scale sometime next year. He called 18A-P a cleaner, more refined process than the current iteration. Intel CEO Lip-Bu Tan has previously said the following 14A node will reach volume production by 2029, with Elon Musk’s planned Terafab facility in Austin already committed to that future process for Tesla and SpaceX production.

The Broader Competitive Picture

Samsung, Intel, and TSMC remain the only three manufacturers globally capable of producing the most advanced AI-grade chips. TSMC’s president and CEO C.C. Wei notably called Intel a “formidable competitor” last month. Bajarin suggested that framing may have been an attempt to get ahead of a significant customer shift. Apple executives have also reportedly toured Samsung’s chip plant under construction in Texas, underscoring that the iPhone maker is actively diversifying its manufacturing options well beyond its longtime sole partner.

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