Intel and Apple reach preliminary agreement for iPhone chip manufacturing boost
Intel's stock prices climbed rapidly after the Apple agreement was reported
Intel and Apple have reached a preliminary agreement for the semiconductor giant to manufacture chips for the iPhone maker's devices, according to a report by the Wall Street Journal on Friday.
This development provides a significant boost to Intel’s ongoing efforts to revive its domestic manufacturing business.
The announcement followed more than a year of intensive discussions between the two technology leaders, culminating in a formal deal hammered out in recent months.
Following the report, Intel stock extended gains to rise 15%, while Apple shares saw a modest increase of approximately 1.7% during afternoon trading.
Securing a contract with Apple provides Intel with a steady stream of demand from one of the world's premier electronics firms, bolstering a reputation that has faced challenges while trailing TSMC in recent years.
Sources suggest the United States government, Intel's largest shareholder since last year, played a pivotal role in bringing Apple to the negotiating table.
While specific products remain unconfirmed, the deal allows Apple to diversify its manufacturing base. CEO Tim Cook previously noted that iPhone sales were hampered by supply constraints at current contract manufacturers.
"Apple had held exploratory discussions about using Intel and Samsung to produce main processors for its devices," Bloomberg News added earlier this week.
This shift comes as high demand for AI components makes securing capacity at TSMC increasingly difficult.
Intel CEO Lip-Bu Tan continues to lead a broader turnaround strategy, having recently secured further investments from Nvidia and SoftBank alongside a major manufacturing project with Tesla.