Apple Partners with Intel for Chip Manufacturing Deal

Apple has announced a preliminary agreement with Intel to manufacture chips for its devices, a significant move after years of reliance on TSMC. This partnership comes amid rising demand for chips and supply chain challenges. Apple CEO Tim Cook has highlighted the ongoing chip shortages affecting product availability. The deal not only represents a strategic shift for Apple but also marks a potential comeback for Intel, which has faced challenges in recent years. With government support and a renewed focus on partnerships, both companies aim to strengthen their positions in the competitive tech landscape. This collaboration could reshape the future of chip production for Apple.

By Narendra Chaudhary May 9, 2026, 09:29 IST

Apple and Intel Forge a New Manufacturing Agreement

Apple has entered into a preliminary agreement with Intel, allowing Intel to produce certain chips for Apple's devices, as reported by sources familiar with the negotiations. This deal, finalized after extensive discussions lasting over a year, represents a pivotal development for both tech giants.

Details of the Agreement

While the exact Apple products that will utilize Intel's chips remain unspecified, the potential impact is substantial. Apple sells over 200 million iPhones each year, in addition to millions of iPads and Mac computers.

Apple's Need for Additional Chip Suppliers

Historically, Apple has depended heavily on Taiwan Semiconductor Manufacturing Company (TSMC) for the production of its custom-designed chips. Although this partnership has been successful, recent challenges have emerged. The soaring demand for TSMC's manufacturing capabilities from companies like Nvidia has diminished Apple's negotiating power, complicating its supply chain.

During the last two earnings calls, Apple CEO Tim Cook highlighted the issue, attributing the shortage of advanced chips to the company's struggles in meeting iPhone demand. He indicated that the supply constraints are likely to persist, with Mac Mini and Mac Studio models potentially facing delays of several months. Following the latest earnings report, Apple also increased the starting price of the Mac Mini.

Intel's Revival Efforts

Intel is working to restore its standing in the semiconductor industry after a challenging decade marked by setbacks. The company has lagged behind competitors like TSMC and Samsung due to various technical issues and leadership changes that have led to a loss of external clients. Intel operates primarily in two sectors: chip design and manufacturing through its Intel Foundry division. New CEO Lip-Bu Tan, who took the helm last spring, has been tasked with revitalizing both aspects of the business.

Government Support in the Negotiation

The U.S. government has played a role in facilitating this agreement. Last summer, the Trump administration converted nearly $9 billion in federal grants into Intel stock, resulting in a 10% ownership stake in the company. Analysts suggest this move significantly influenced Apple's decision to negotiate with Intel. Commerce Secretary Howard Lutnick has been actively involved, holding numerous discussions with senior Apple executives, including Tim Cook, as well as leaders from SpaceX and Nvidia, to encourage collaboration with Intel. This agreement marks Intel's successful partnerships with all three companies.

A Historic Partnership

The relationship between Apple and Intel dates back to 2006 when Apple began using Intel processors in its Mac computers. However, this collaboration ended in 2020 when Apple transitioned to its own custom processors based on Arm Holdings' architecture. The current manufacturing agreement will not involve Intel-designed chips; instead, it will see Intel's factories producing chips designed by Apple itself.