Intel Shares Surge Nearly 14% on Report of Preliminary Chip-Making Deal With Apple

Intel's stock soared nearly 14% on Friday after the Wall Street Journal reported the two companies have reached a preliminary agreement that would see Intel manufacture some chips for Apple devices, a development that analysts say would mark a pivotal moment for Intel's long-troubled foundry business.

Apple shares added 2% on the news. Both companies declined to comment.

The talks have been developing for more than a year, with a preliminary agreement reached in recent months, according to people familiar with the matter cited by the Journal. If completed, the arrangement would represent the most significant external validation yet for Intel's contract chip manufacturing division — a business that has spent years navigating production delays and low yields.

"I 100% believe this is going to happen. I don't know when," chip analyst Ben Bajarin of Creative Strategies said in an interview.

For Apple, the deal would mark the end of an era of sole reliance on Taiwan Semiconductor Manufacturing Co. Apple is currently TSMC's second-largest customer, trailing only Nvidia, according to Bajarin. But with AI-driven demand consuming TSMC's wafer capacity at an accelerating pace, Apple has been seeking to diversify its chip supply chain.

"Intel is the only place that can scale up capacity as a viable second source," Bajarin said.

Intel is currently ramping production at a new fabrication plant in Chandler, Arizona, running on its most advanced node, called 18A, which is designed to rival TSMC's 2nm process — a technology currently manufactured only in Taiwan. Bajarin said Apple is more likely to wait for Intel's next-generation node, 18A-P, which he described as capable of scaling as soon as next year. He called the current 18A node "a little bit rough," adding that 18A-P "cleans a lot of stuff up."

Intel's foundry unit has historically served the company itself as its only meaningful customer. Beyond Apple, the only other major external foundry commitment on record is a longer-horizon deal: Elon Musk said last month that he intends to use Intel's future 14A node at his $119 billion Terafab facility planned for Austin, Texas, which is designed to produce chips for Tesla, SpaceX, and SpaceXAI. Intel CEO Lip-Bu Tan said in February that 14A will reach volume production in 2029.

Intel already has customers — including Amazon and Cisco — for the advanced packaging side of its business, in which individual chip components are bonded together. But a full foundry relationship with Apple would carry a different order of magnitude in scale and prestige.

Intel shares are up more than 200% so far this year, reflecting a broader recalibration of investor sentiment around the company's manufacturing revival.

TSMC, for its part, appeared to acknowledge the changing competitive dynamics last month when President and CEO C.C. Wei described Intel as a "formidable competitor" — a characterization Bajarin tied directly to the Apple situation. "If you're about to have one of your largest customers probably sign a deal with a competing foundry, that would be the kind of thing you say to perhaps soften the blow," Bajarin said.

Samsung, Intel, and TSMC remain the only three companies globally capable of producing the most advanced chips required for AI workloads, and according to Bajarin, "nobody can build fast enough."

With Apple reportedly also visiting Samsung's chip manufacturing plant under construction in Texas, the iPhone maker appears to be actively exploring a multi-foundry strategy — a shift that could reshape advanced semiconductor supply chains for years ahead.

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