Apple is apparently taking steps to diversify its chip production. Earlier this month, it was reported that the tech giant had entered a preliminary agreement with Intel. This arrangement will supposedly allow the chipmaker to produce processors for Apple. Now, a recent post by analyst Ming-Chi Kuo further backs up this claim.
As per the post, the companies have started production for legacy Apple silicon chips. Kuo noted that the bitten fruit brand has kicked off three production lines using Intel’s 18A-P process. This is equivalent to TSMC’s process used on the A18 Pro chip. As per the post, these processors are low-end components meant for iPhone, iPads and Macs. Among these chips, the analyst estimated that roughly 80% will be equipped on iPhones.
At the moment, Apple is reportedly doing small-scale testing throughout this year. According to Kuo, the companies intend to ramp up production in 2027 and 2028 before finally dialing down capacity the following year. At the same time, the iPhone maker may be looking to leverage Intel’s more advanced process nodes in the future.
Of course, it is worth noting that despite this collaboration, Apple is still largely relying on TSMC for chip production. As detailed in the analyst’s post, the manufacturer will still retain more than 90% of the supply share for the foreseeable future.
With this in mind, Kuo noted that TSMC’s advanced-node capacity is becoming a scarce resource. This is because the company is shifting its allocation towards AI. While the analyst explained that Apple began discussions with Intel before TSMC’s advanced node capacity became limited, the brand recognises the trend towards AI. As such, Apple needs to reduce its dependence on a single foundry partner. Furthermore, the partnership with Intel may provide it with more bargaining power when dealing with TSMC.
(Source: Ming-Chi Kuo via X)
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