Apple seeks a second chip source; Intel and Samsung compete for the deal
▼ Summary
– Apple is in early-stage talks with Intel and Samsung about producing some of its M-series chips, aiming to diversify away from sole reliance on TSMC.
– No orders have been placed, and Apple has concerns about whether non-TSMC technology can match the yield, performance, and timing it depends on.
– The most likely scenario is that Intel or Samsung would produce lower-end M-series chips for products like MacBook Air and iPad Pro, with initial shipments not expected until mid-2027.
– The strategic logic includes geopolitical risk from TSMC’s concentration in Taiwan and commercial leverage from Apple’s high demand as a customer.
– The key challenge is yield, as both Intel and Samsung have not fully closed the quality gap with TSMC, which could impact product cost and customer experience at Apple’s scale.
Apple is quietly exploring a major shift in its chip manufacturing strategy, signaling that even the most tightly held supplier relationships are not immune to reevaluation. According to a Bloomberg report on Tuesday, the tech giant has initiated early-stage talks with both Intel and Samsung Electronics about producing some of its M-series processors. While the discussions remain exploratory, the mere fact that Apple is considering alternatives to its long-time partner, Taiwan Semiconductor Manufacturing Company (TSMC), marks a significant development. 9to5Mac confirmed the report the same day, calling it the clearest indication yet that Apple is serious about addressing its foundry concentration risk.
It is important to emphasize that Apple is not preparing to sever ties with TSMC. The conversations are preliminary, no orders have been placed, and internal concerns persist about whether non-TSMC technology can match the yield, performance, and timing Apple demands. Based on analysis from AppleInsider, the most plausible outcome is that Apple reserves Intel or Samsung for its lower-end M-series chips,those powering the MacBook Air, iPad Pro, and other mid-volume products,while keeping its highest-performance silicon on TSMC nodes. Any initial shipments from an alternative foundry are not expected until the second or third quarter of 2027.
The strategic rationale behind this move is twofold. The first track is geopolitical: TSMC’s heavy concentration in Taiwan represents a known supply-chain risk in any scenario involving Chinese action against the island. Apple has been quietly diversifying around that vulnerability for years. The second track is commercial. Intel’s foundry services, under the leadership of Lip-Bu Tan, have been rebuilding aggressively, with Apple as one of the most sought-after customers. Samsung’s foundry, while still a step behind TSMC on leading-edge nodes, offers historical capability and excess capacity. Both companies are eager to win Apple’s business, giving Apple unusual leverage in negotiations.
Yet the hard problem remains yield. Industry analysts at Semiwiki have tracked the gap between TSMC’s leading-edge nodes and those of Intel and Samsung through 2026. The consensus is that both alternative foundries are closer to TSMC’s quality than they have been in years, but neither has fully closed the gap. For Apple, which ships tens of millions of M-series units annually and requires consistent performance across that volume, even a small yield difference compounds into meaningful product-cost and customer-experience disparities.
The supply context adds urgency. TNW reported last week that Apple raised the entry-level Mac mini’s starting price from $599 to $799 after AI-driven demand depleted inventory at higher configurations. That kind of demand pressure makes any foundry diversification more urgent, but also riskier: a yield problem at a new manufacturing partner would amplify, not relieve, the supply constraint Apple is currently facing.
Tuesday’s reporting is unlikely to change Apple’s near-term product roadmap. The longer-term signal, however, is more consequential. For the first time in its modern silicon era, Apple has publicly hinted that its relationship with TSMC is no longer treated as singular. Whether the eventual outcome is a partial second-source arrangement, a long-running negotiating posture, or no change at all, the fact that Apple is publicly signalling diversification interest changes the bargaining table for all three foundries.
The next signal will come not from Apple but from Intel and Samsung. If either announces a leading-edge process win that includes Apple as a customer over the next 12 to 24 months, the diversification thesis will have moved from exploration to commercial reality. If neither does, the discussions will be remembered as one of the smaller chess moves in Apple’s longer game with its most important supplier.
(Source: The Next Web)
