Intel courts Apple in bid for strategic alliance
Talks include potential Apple investment as Intel seeks to reinvent itself with backing from global tech giants.
Intel has offered Apple a partnership, including the possibility of an investment in the company, according to a Bloomberg report citing sources familiar with the matter. The sources said the two companies are exploring various options for cooperation. The talks are still in the early stages and may not result in any agreement.
In recent weeks, Intel CEO Lip-Bu Tan has launched a series of moves to diversify Intel’s holdings and forge alliances with strategic players in the market. In August, Japan’s SoftBank invested $2 billion in Intel in exchange for a 2% stake in the company.
Shortly afterward, Intel reached a deal with the U.S. government, under which Washington would receive 10% of Intel’s shares by converting $10.9 billion in grants that had originally been designated for building chip factories in the United States.
Last week, Intel and Nvidia signed a landmark agreement in which the world’s most valuable company committed to invest $5 billion in the struggling chipmaker.
Now, according to Bloomberg, Tan is pursuing a strategic alliance with another major player: Apple. The two companies have a long history of cooperation. Between 2006 and 2020, Intel supplied processors for Apple’s Mac computers. But starting in 2020, Apple, under the leadership of Johny Srouji, the company’s senior Israeli executive, began replacing Intel chips with its own in-house processors.
Those chips, manufactured by Taiwan’s TSMC, have been widely successful, and the transition is regarded as one of the most complex and successful in Apple’s history. In 2019, Apple also acquired Intel’s modem chip business, allowing it to shift away from Qualcomm and develop its own modem technology.
As a result, Apple has little reason or desire to return to using Intel processors. However, Intel’s foundry division could theoretically compete with TSMC as a manufacturer of Apple’s custom chips.
For Apple, an investment in Intel could also strengthen its standing with the Trump administration, which currently holds 10% of Intel’s shares. At a White House meeting in August, Apple CEO Tim Cook pledged to invest $600 billion over four years in U.S. production. A potential Intel investment could partly fulfill that commitment, depending on its scale.
