Apple and Intel Reach Preliminary Chip-Manufacturing Deal, Marking the First Partnership Since Apple's 2020 Silicon Switch

Overview

Apple and Intel have reached a preliminary agreement for Intel to manufacture some of the chips that power Apple devices, according to a Wall Street Journal report published May 8, 2026. The deal, reached after more than a year of intensive negotiations, would mark the first manufacturing partnership between the two companies since Apple completed its transition to its own Apple Silicon processors in 2020 and end its exclusive reliance on Taiwan Semiconductor Manufacturing Co. (TSMC) for advanced chip production.

Intel shares surged nearly 14% on the day of the announcement, while Apple stock gained approximately 1.7%, according to The Spokesman-Review. Both Apple and Intel declined to comment.

What We Know

The agreement is described as preliminary, and the specific Apple products that would use Intel-manufactured chips have not been disclosed, per TradingKey. Industry analysts and supply-chain sources, however, have pointed toward entry-level M-series chips for MacBooks and iPads as the most likely initial scope, with high-end Pro and Max variants remaining with TSMC. TokenRing reported that Intel could begin producing M-series chips for Apple as early as 2027.

The chips in question are expected to use Intel’s 18A process node — a 1.8-nanometre-class technology the company positions as competitive with TSMC’s most advanced offerings. Intel’s 18A node features RibbonFET gate-all-around transistor architecture and PowerVia backside power delivery, two manufacturing innovations Intel says improve performance and power efficiency over conventional planar designs, according to TokenRing. Analysts have suggested Apple may prefer the refined 18A-P variant, which according to chip analyst Ben Bajarin of Creative Strategies delivers a “15% to 20% improvement in performance-per-watt” over the base 18A node. Bajarin described Intel as “the only place that can scale up capacity as a viable second source” for Apple, as quoted by BusinessStory.

Intel’s primary fab for the 18A process is located in Chandler, Arizona, with research facilities in Oregon supporting High-NA EUV lithography, according to BusinessStory.

The TSMC Pressure Behind Apple’s Pivot

Apple currently relies on TSMC for all of its advanced chip production and is TSMC’s second-largest customer after Nvidia, according to BusinessStory. That concentration has grown increasingly costly: TSMC’s advanced production lines are under intense demand from AI chip designers including Nvidia and AMD, and Apple executives have cited limited chip availability for iPhone and Mac devices as a factor weighing on growth, per TrendForce. TSMC holds approximately 64% of the global foundry market; Intel’s own foundry business currently controls less than 5%, according to The Next Web.

Adding Intel as a second manufacturing source would give Apple a domestic alternative and significant additional bargaining leverage. The Next Web estimated that if Apple shifted 20% of its base M-series wafers to Intel, it would generate approximately $630 million in annual foundry revenue for Intel — compared to the $174 million in external foundry revenue Intel reported in the most recent quarter.

A Landmark Win for Intel Foundry — and for Washington

For Intel, the Apple deal represents the most credibility-defining customer win since the company formally spun out its foundry operations. Intel CEO Lip-Bu Tan has staked the company’s turnaround on rebuilding its manufacturing reputation, stating that “Intel is deeply committed to ensuring the world’s most advanced technologies are American made,” according to the company’s official press release from August 2025. Intel’s foundry segment posted a $2.4 billion operating loss in Q1 2026, according to The Next Web, making a high-volume Apple contract transformative for the unit’s economics.

The deal carries a strong political dimension. The Trump administration converted nearly $9 billion in federal subsidies — drawn from the CHIPS and Science Act — into an equity stake of 9.9% in Intel, acquiring 433.3 million shares at $20.47 per share in August 2025, according to Intel’s press release. The government’s total investment commitment, including $2.2 billion dispersed earlier and $3.2 billion from the Secure Enclave program, amounts to $11.1 billion. Commerce Secretary Howard Lutnick met multiple times with Apple CEO Tim Cook, Nvidia CEO Jensen Huang, and Elon Musk over the past year to facilitate Intel partnerships, per TradingKey. President Trump personally stated, “I am bullish on Intel,” according to TradingKey.

Lutnick has described the administration’s objective as “reinforcing our country’s dominance in artificial intelligence,” according to Intel’s press release. Intel has committed to $108 billion in U.S. capital investment and $79 billion in domestic R&D spending over five years, as stated in the same release.

Intel shares have risen more than 200% year-to-date as of the announcement, and the government’s $8.9 billion stake — acquired at $20.47 per share — has returned approximately 300% in the nine months since purchase, according to The Next Web. Intel’s market capitalization reached $627.8 billion on the day the Apple deal was reported, per TradingKey.

What We Don’t Know

Critical details remain unresolved. Which specific Apple products will use Intel-manufactured chips, which process node will be confirmed for production, and the financial terms of the arrangement are all undisclosed. Neither company has officially confirmed any aspect of the agreement. Industry observers note that the deal is described only as preliminary, and Apple has a history of evaluating manufacturing partners without finalizing contracts.

The Apple partnership is part of a broader Intel foundry customer push: the company has also announced arrangements with Nvidia, involving a $5 billion investment for custom data center CPUs, and with Tesla for a chip plant in Texas, according to TradingKey. As previously reported, Intel Foundry has also been in advanced negotiations with Google and Amazon for chip packaging services.

Analysis

The Apple-Intel agreement, if confirmed and expanded, would represent a structural shift in the global semiconductor landscape. Apple ships more than 200 million iPhones annually, in addition to millions of iPads and Macs, according to The Spokesman-Review. Even capturing a fraction of that volume would give Intel’s foundry business the scale and legitimacy it has lacked since the company fell behind TSMC in process technology in the early 2020s.

For U.S. semiconductor policy, the deal is also a validation of the CHIPS Act’s industrial strategy. By converting grants into equity and then leveraging that stake to broker partnerships between major American technology companies, the administration has created financial incentives — for Intel, Apple, and Washington — that align in ways the original grant structure did not. The government’s 9.9% stake, passive and without board representation, has nonetheless given Washington a seat at the table in shaping where cutting-edge chip manufacturing happens.