Apple may switch from Intel-based chips to its own chips that are being developed in-house, thereby causing Intel’s stock to take a beating.
Intel shares dropped sharply on Monday after a report that Apple would switch from Intel’s chips to its own chips for use on Mac computers.
As a result, Intel’s shares fell as much as 9 percent following the report, which cited unnamed sources familiar with the matter. Apple has declined to comment and Intel said it does not respond to speculations or rumors.
This has been some time coming, and while Apple uses chips from competitors such as Intel, Qualcomm, Broadcom and Arm, it has increasingly looked to bring design of the most important chips — for things like artificial intelligence and augmented reality — in-house, with chips for Mac, Watch, AirPods and Beats.
According to the report, Apple could replace Intel’s processors in Macs as part of a multi-step transition beginning in 2020.
When Apple released its A11 bionic chip for the iPhone X, executives stated that they began designing chips over a decade ago, and that each chip is designed 3 years out.
Johnny Srouji, Apple’s senior vice president of hardware technologies, stated last year that Apple was looking into chip-based acquisitions in Israel. In addition, Apple’s chief financial officer, Luca Maestri, has said that a huge chunk of Apple’s R&D budget goes to chips.
Apple remains a large and influential customer for Intel, with its products currently using versions of the Intel Xeon, the Core i5 and i7 processors and the Core m3 processor.
Stay tuned for additional details as they become available.