apple and Intel Re-engage: A potential Semiconductor ‘Reunion’ by 2027
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Apple is exploring a return to Intel as a foundry partner, potentially as early as 2027, signaling a major shift in its supply chain strategy and a boost for Intel’s aspiring foundry business. The move, first reported at the end of 2023, involves Apple evaluating Intel’s cutting-edge ’18A’ (1.8 nanoscale) process for the production of low-end M-series chips, a development that could reshape the competitive landscape of the semiconductor industry.
A Strategic Diversification from TSMC
For years, Taiwan Semiconductor Manufacturing Company (TSMC) has held a near-monopoly on Apple’s chip production. However,recent events have prompted Apple to pursue a “supply chain dualization” strategy,reducing its dependence on a single manufacturer. This decision stems from lessons learned during the global supply chain disruptions of 2020-2022, which highlighted the risks of over-reliance on one company. “Distributing chips with low technical difficulty to a ‘second source’ is an essential choice from a risk management perspective,” one industry analyst noted.
Apple is taking a pragmatic approach, allocating lower-risk, lower-end chip production to Intel while continuing to entrust its most complex and critical chips to TSMC. The initial target for Intel’s 18A process is the entry-level M-series system-on-chip (soc) found in products like the MacBook Air and iPad Pro. Shipments of this product line are projected to reach approximately 20 million units by 2025, stabilizing between 15 and 20 million units annually in 2026 and 2027.
Intel’s 18A Process Gains Traction
The foundation of this potential partnership lies in the increasing reliability of Intel’s 18A process. Just a short time ago, Intel’s foundry roadmap was uncertain, and initial 18A yields were projected to be low. However,Apple’s decision to sign a non-disclosure agreement (NDA) and receive version 0.9.1GA of the process design kit (PDK) for the ’18AP’ process demonstrates a notable vote of confidence in Intel’s technological advancements.
A PDK is a crucial dataset that enables chip designers to tailor their designs to a specific foundry’s manufacturing process. Receiving the PDK signifies that Apple has moved beyond initial interest and entered the active design and simulation phase. according to Ming-Chi Kuo, a renowned semiconductor analyst, “apple’s internal simulation results are coming close to expectations,” and the company is awaiting the release of PDK 1.0 and 1.1, scheduled for the first quarter of 2026.
Geopolitical Considerations and US Manufacturing
Beyond supply chain resilience, geopolitical factors are also playing a role in Apple’s decision. the U.S. government is actively promoting domestic semiconductor production through the CHIPS Act, and Intel’s Arizona fab is a key component of this initiative. Entrusting production to Intel’s 18A process would likely result in manufacturing taking place in the U.S., aligning with the government’s policy objectives.
Challenges and the Path Forward
Despite the positive signs, significant hurdles remain. The semiconductor industry operates on the principle that “nothing can be certain until tape-out,” the stage where the chip design is finalized and transferred to the production facility. Intel must deliver a complete PDK tool chain and demonstrate the yield and performance metrics required by Apple by the first half of 2026 to secure the contract.
If Intel successfully navigates this “Valley of Death,” securing Apple as a major customer would instantly elevate its position as a significant foundry competitor to TSMC. The industry is keenly watching to see if a MacBook powered by an Intel-manufactured chip will reappear in 2027, marking a historic and potentially transformative moment for both companies and the global semiconductor landscape.
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