Apple Turns to Intel for Chip Manufacturing as TSMC Capacity Tightens

Apple’s chip supply problem is more exposed than the company typically lets on. On his most recent earnings call, Tim Cook acknowledged that iPhone 17 supply was constrained because Apple couldn’t secure enough A19 and A19 Pro chips from TSMC. With AI server demand consuming an increasing share of TSMC’s capacity, Apple has less leverage over production slots than it once did, and its dependence on a single Taiwan-based manufacturer has become a visible liability.

That context makes President Trump’s Thursday social media post more than a diplomatic photo opportunity. Trump said Apple had agreed to work with Intel to manufacture some of its chips in the United States. Intel’s stock rose 9 percent in premarket trading on the news, while Apple gained 0.6 percent. Neither company has officially confirmed anything.

The Wall Street Journal reported last month that Apple and Intel had reached a preliminary agreement under which Intel would fabricate processors based on Apple’s own chip designs, mirroring the role TSMC currently plays. Early speculation has pointed toward lower-end processors, possibly the entry-level M-series chips used in select iPad and Mac models, rather than the high-performance silicon Apple uses in its Pro lineup or the A20 Pro expected in future iPhones.

Intel’s Turnaround as the Real Story

The partnership, if confirmed, says as much about Intel’s trajectory as Apple’s supply chain anxiety. Lip-Bu Tan took over as Intel CEO last year after the company removed Pat Gelsinger, and has since focused on reviving its contract manufacturing business. Intel’s stock has climbed 464 percent over the past 12 months, with its market cap reaching $608.7 billion. The U.S. government also converted $8.9 billion in unpaid Chips Act grants into a 10 percent equity stake in the company last year.

Apple’s history with Intel as a chip supplier was not smooth. Before the transition to Apple silicon, Intel-designed Mac chips arrived on inconsistent schedules, and the relationship contributed to Apple’s decision to design its own Arm-based processors. Returning to Intel, even in a limited fabrication role, reflects how much both companies have changed since that era.