Intel shares rose 14% after reports of a deal with Apple.

Short about the event

After publishing quarterly results Intel shares rose in price and April turned out to be the most successful month in their 55‑year trading history. Yesterday evening a news story appeared about a potential deal with Apple that allowed Intel shares to jump 14 % in one session.

Deal details

According to preliminary data from both companies (which have not yet confirmed the terms), Intel will develop and manufacture processors for certain Apple devices. Negotiations on this matter have been ongoing for more than a year. During that period Nvidia strengthened its status as TSMC’s largest customer, while previously Apple had been the leading customer of the Taiwanese chipmaker. It seems that TSMC’s shift in priorities created favorable conditions for cooperation between Apple and Intel.

Market reaction

* Apple shares rose 2 % after the news were released.
* Since the beginning of the year Intel shares have doubled (200 %). The question of finding “anchor” clients for contract chip production is often discussed.
* Experts believe that for Apple Intel’s contract capacity is the only real alternative to TSMC, because they can scale in the required ranges.

Expectations and prospects

Analysts at Creative Strategies noted that Apple will likely wait for Intel to transition to the 18 A‑P technology, which will appear next year. Until then Intel faces difficulties with the previous 18 A technology.

Elon Musk also highlighted Intel’s potential for contract chip manufacturing, but cooperation with SpaceX and Tesla is likely to start only by 2029 when the 14 A process is mastered at large volumes.

Impact on TSMC

The Apple‑Intel deal should not significantly affect TSMC, as the company is already operating at its limits.