9b078118f332f9257b4a69d50a0aefb5

Apple Deal Could Be a Game-Changer

by

  • Analyst Ming-Chi Kuo predicted that Apple would use Intel Foundries for its low-end M-series chips.

  • Diversification makes sense for Apple and the deal would be a big win for Intel’s struggling foundry business.

  • In addition to additional foundry revenue, the Apple deal will provide a powerful boost to Intel’s manufacturing operations.

  • 10 stocks we like better than Intel ›

Although nothing is official or guaranteed, intel (NASDAQ: INTC) may be on the way to victory Apple (NASDAQ:AAPL) As a major foundry customer. In a recent post on X, analyst Ming-Chi Kuo said that Intel’s visibility of becoming an advanced node supplier has “significantly improved.”

According to Kuo, Apple’s experience with the Preliminary Process Design Kit (PDK) for Intel’s 18A-P process, an improved version of its Intel 18A process, has met expectations. Apple is now waiting for version 1.0, which is expected from Intel in the first quarter of 2026. PDK enables potential customers to design, simulate, and verify chip designs for a specific manufacturing process.

Kuo says Apple plans to use the Intel 18A-P process for its lowest-end M-series processors, which currently power the MacBook Air and iPad Pro, with shipments expected to begin around the second quarter of 2027. Kuo expects initial annual volume to be between 15 million and 20 million chips.

Inside the Intel Semiconductor Factory.
Image source: Intel.

If the Apple deal is successful, Intel’s initial revenue impact Will be meaningful. Apple reportedly pays TSMC At about $45 for each of its A18 chips, costs are expected to rise dramatically for TSMC’s next generation of nodesdepends on quantity and quantity Given the amount Apple pays Intel per chip, this potential deal could be worth $1 billion annually to Intel.

Apart from revenue, a big benefit for Intel is the vote of confidence it received from the world’s largest semiconductor buyer. Intel faces technical hurdles as it attempts to build a sustainable and competitive foundry business, including achieving manufacturing yields that generate acceptable profit margins. However, the bigger challenge is to win the trust of potential customers.

Intel attempted to build a foundry business more than a decade ago, but the company ultimately abandoned the effort. Apple reportedly considered Intel as a manufacturer for its iPhone chips in 2011, but ultimately chose TSMC. TSMC founder Morris Chang has said that Apple CEO Tim Cook told him that “Intel doesn’t know how to be a foundry.”

This perception remains the most significant challenge for Intel as it tries to become a world-class foundry again. Intel CEO Lip-Bu Tan has made listening to customers a major priority, something Intel has struggled with in the past. This strategy is clearly working as Apple is moving towards choosing Intel as a manufacturing supplier.



<a href=

Leave a Comment