Since 2014, TSMC has been the exclusive foundry partner of Apple’s self-developed system-on-chip (SoC). This 12-year exclusive cooperation may now be reaching a turning point. The Wall Street Journal quoted sources familiar with the chip supply chain as saying that as TSMC has significantly deepened its cooperation with artificial intelligence companies such as Nvidia in recent years, Apple is evaluating whether to hand over the manufacturing of some low-end processors to foundries other than TSMC.
The report did not name potential new partners, but there have been many reports in the industry that Intel is expected to OEM some of Apple's low-end chips starting in 2027 or 2028. GF Securities analyst Pu Deyu said a few months ago that he expected Apple to reach an foundry agreement with Intel to provide processors for some non-Pro iPhones as early as 2028. This means that if the two parties eventually cooperate, Intel may OEM part of its chip production capacity for some future iPhone models in the A21 or A22 era.
Apple's idea of "returning to Intel" is not limited to iPhone processors. Tianfeng Securities analyst Ming-Chi Kuo predicted last year that Intel would begin manufacturing the lowest-end M-series chips for some entry-level Mac and iPad models as early as mid-2027. Apple plans to use Intel's 18A process technology on these products, but this statement did not involve iPhone chips. Unlike Intel, which dominated processor architecture design in the Intel Mac era, if Intel participates in Apple's chip business in the future, it is expected to only be responsible for wafer manufacturing, and the chip architecture and design will still be in the hands of Apple.
If the cooperation comes to fruition, Intel will help Apple diversify manufacturing risks and broaden its supply chain layout at critical times. Currently, as demand for artificial intelligence servers soars, Nvidia is said to have replaced Apple as TSMC's largest customer. Storage chips, including NAND flash memory and DRAM, are fiercely competitive in the AI server market, putting pressure on Apple's supply and costs. Supply chain sources in the Wall Street Journal said that Samsung and SK Hynix also benefited from this increase in demand and took the opportunity to make stronger bargaining demands on the price of memory chips from customers such as Apple.
In response to the market's concern about storage costs, Apple CEO Tim Cook said in last week's earnings call that the impact of rising memory prices on the company's gross profit margin last fiscal quarter was "very limited," but he expected it to have a "slightly larger impact" this fiscal quarter and emphasized that Apple would "evaluate a range of response options" when necessary. At the same time, Guo Mingchi believes that the starting price of the iPhone 18 series is expected to remain unchanged even if it faces upstream price pressure.
Judging from the latest financial report, memory price fluctuations have not yet shaken Apple's profitability. The company's revenue in the last fiscal quarter reached US$143.8 billion, a year-on-year increase of 16%. It also gave guidance for a year-on-year revenue growth of 13% to 16% and a gross profit margin of 48% to 49% for the current fiscal quarter. It still showed strong profit performance in the context of the AI wave and increasing supply chain cost uncertainty. At this point, Apple is considering "betting on the second supply source" for some processor OEMs, which is regarded by the outside world as an important step in its initiative to reconstruct the supply chain and balance costs and production capacity security in the AI era.