Apple Inc. (NASDAQ:AAPL) is exploring potential partnerships with Intel Corp. (NASDAQ:INTC) and Samsung Electronics Co. Ltd. (OTC:SSNLF) to manufacture its processors in the United States, according to a report.
The talks are part of the company’s effort to diversify its chip supply chain beyond its reliance on Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE:TSM), according to a Bloomberg report.
Early-Stage Talks, Site Visits
Apple executives have reportedly visited a Samsung facility being built in Texas and also had early conversations with Intel about using its foundry services. None of the talks has produced orders, and the work is still described as preliminary.
While these moves could provide Apple with additional manufacturing flexibility, the company is said to have concerns about adopting non-TSMC production technologies, particularly around reliability and the ability to scale output efficiently.
The report said Apple's internal discussions are still in an early phase.
Supply Constraints Fuel Move
The move came amid Apple's ongoing challenges with chip availability that affected iPhone sales in the previous quarter. CEO Tim Cook noted that shortages of advanced processors had limited device availability, underscoring the risks of depending heavily on a single supplier. Those processors serve as the core computing component inside the device.
As Apple navigates supply chain challenges, it has implemented a $100 billion share buyback and raised its dividend by 4%.
The iPhone maker reported better-than-expected second-quarter results, exceeding both earnings per share and revenue estimates. Cook characterized the period as Apple’s “best March quarter ever,” highlighting double-digit growth across all geographic segments and a record-high installed base of active devices.
Strategy Transition Underway
Apple's capital strategy is undergoing a quiet but significant transformation as Cook prepares to step down. The company is quietly rewriting parts of its financial and strategic playbook, signaling a potential end to the era of aggressive cash returns and a move towards ‘net cash neutral.'
Industry experts are optimistic about Apple's future. Wedbush analyst Dan Ives predicts that Apple's ‘Golden Era' is near, while Gene Munster sees a 10% upside.
Benzinga Edge Stock Rankings indicate that AAPL maintains a strong price trend in the short, medium and long term, with a solid Momentum score in the 68th percentile.
Price Action: Apple's shares were down 0.1% overnight after falling 1.18% in normal trading on Monday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by a Benzinga editor.
Photo courtesy: Andrey-Bayda via Shutterstock
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