Apple is evaluating supply chain diversification through exploratory discussions with Intel and Samsung for US-based semiconductor manufacturing. This strategy aims to mitigate geopolitical risks and decrease reliance on TSMC, impacting global foundry competitiveness and US technological sovereignty.<\/p>\n
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Apple has held preliminary discussions with Intel and Samsung Electronics to explore the potential production of advanced processors within the United States. The initiative intends to diversify the supply chain for critical components, which now relies mainly on Taiwan Semiconductor Manufacturing (TSMC), with the ultimate goal being to address ongoing supply constraints and reduce geographic concentration.<\/p>\n
According to Bloomberg News reports, Apple executives visited a Samsung Electronics facility in Texas and engaged in early talks with Intel to evaluate foundry services. This exploration follows internal assessments regarding the risks associated with a centralized manufacturing footprint.\u00a0<\/p>\n
Timo Cook, CEO, Apple, said<\/a> in an internal meeting back in 2022 that routing 60% of production through a single location is probably not a strategic position. Cook further said during a recent quarterly earnings call that constrained chip supply has limited growth and that the corporation has less flexibility in the supply chain than it would normally require.<\/p>\n The Long Relationship of Apple and TSMC<\/p>\n The partnership between Apple and TSMC<\/a> has served as the foundation for modern semiconductor advancement for over a decade. In 2013, TSMC committed US$10 billion to build capacity for the 20nm node based on the projected demand from Apple. This investment allowed Apple to launch the A8 chip in 2014, establishing a model where Apple funded the yield learning curve for every major node transition.<\/p>\n Financial data indicates that the annual expenditure of Apple with TSMC grew from US$2 billion in 2014 to US$24 billion in 2025<\/a>. This represents a twelve-fold increase over 11 years. Apple accounted for 25% of the revenue of TSMC at its peak and remains a critical anchor tenant with a 20% revenue share in 2025.\u00a0<\/p>\n Historically, Apple has secured over 50% of the capacity at node launches, and in specific instances, the corporation has utilized nearly 100% of the initial output for new technologies.<\/p>\n The dominance of the foundry model relies on an anchor tenant to de-risk capital expenditures. Between 2019 and 2022, TSMC deployed US$98 billion in capital, exceeding the cumulative spending of the previous 14 years. This trajectory was supported by the purchase obligations of Apple, which scaled from US$8.7 billion in 2010 to US$71 billion in 2022. However, the market landscape is shifting as high-performance computing (HPC) driven by AI generates significant cash for competitors like Nvidia.<\/p>\n The revenue mix at TSMC reflects this transition, as HPC revenue grew from 36% in 2020 to 58% in 2025, while smartphone-related revenue decreased from 46% to 29%. Projections indicate that Nvidia will consume more N3 wafers than Apple by 4Q27.\u00a0<\/p>\n For the first time in a decade, Apple is not the sole dominant customer on a new node, as its share of N2 production is expected to drop to 48%. This shift is partly due to the architecture of the A16 node, which is optimized for HPC features such as backside power delivery and gate-all-around transistors.<\/p>\n Apple Betting on Samsung and Intel<\/p>\n The discussions between Apple, Intel, and Samsung<\/a> remain in early stages, and no formal orders have been placed. Apple personnel recently toured the semiconductor fabrication plant of Samsung in Taylor, Texas. Samsung previously manufactured chip designs for the iPhone more than a decade ago and now supplies various other components. Securing an order for main processors would represent a significant shift in market share, as Samsung trails TSMC in the contract manufacturing sector.<\/p>\n For Intel, a partnership with Apple is central to the turnaround strategy led by Lip-Bu Tan, CEO, Intel. After various technical challenges in building its foundry business, obtaining Apple as a customer would serve as a validation of its manufacturing capabilities.\u00a0<\/p>\n There is also a\u00a0 diplomatic component to these talks, as some executives at Apple view an alliance with Intel as a method to align with the objectives of the White House<\/a>. The US government reached an investment agreement with Intel in 2023 to promote domestic semiconductor manufacturing.<\/p>\n