Intel begins iPhone and Mac chip production as Apple explores TSMC alternative: Report

Apple has officially initiated production of low-end and legacy processors for iPhones, iPads, and Mac computers at Intel’s foundries, as per a new report by analyst Ming-Chi Kuo. While Apple has long relied on TSMC to manufacture its custom silicon, a report by The Wall Street Journal last week noted that the Cupertino-based tech giant had reached a preliminary agreement with Intel to manufacture some of the chips powering its devices.

Apple begins producing Intel-powered chips for iPhones:

According to Kuo, Apple has already assigned low-end or legacy processors across iPhone, iPad and Mac product lines to Intel’s 18A-P manufacturing process. He claims around 80% of the order mix is tied to iPhone chips, which is said to roughly match Apple’s broader product sales distribution

Kuo says Apple’s production roadmap with Intel includes ‘small-scale testing’ in 2026, production ramp-up in 2027, further growth through 2028 and a decline by 2029.

Apple is said to be ‘actively evaluating’ Intel’s other advanced-node technologies. However, the report indicates that Intel’s mass production timeline and exact shipment scale remain unclear, with assembly partners yet to see official shipment schedules.

Kuo states Intel’s primary yield target for 2027 is to stabilise production at 50% to 60% or higher for its manufacturing process. Meanwhile, the company is also said to realise that TSMC’s manufacturing resources will increasingly tilt toward artificial intelligence and high-performance computing.

“Apple is simulating and validating Intel’s potential as a full-product-line supplier, deliberately using the complete 18A-P generation to optimize yield and collaboration processes, rather than merely placing a low-risk trial order.” Kuo notes.

Despite the new partnership, TSMC is said to retain over 90% of Apple’s supply share in the near term. However, Kuo notes that the deal gives the company an opportunity to “cultivate a new supplier while it still holds bargaining power.”

Tim Cook on chip constraints:

Apple CEO Tim Cook had also recently discussed during the company’s Q2 2026 earnings call how the lack of advanced chip availability was straining the company’s ability to meet customer demand for products like iPhones and Macs.

“We have less flexibility in the supply chain than we normally would,” Cook said earlier in the month.

“We believe memory costs will drive an increasing impact on our business,” Cook added during the call.

Notably, rising memory chip prices have also led to costs increasing across the smartphone industry. However, Apple has so far prevented these rising costs from affecting its products, but that remains less certain in the future. The company is expected to hold its next big product launch, likely to occur in September, where it is expected to unveil the iPhone 18 Pro series alongside the iPhone Ultra/Fold.