Intel Corporation saw its stock climb approximately 2.7% in after-hours trading Thursday following a statement from President Donald Trump confirming that Apple has agreed to collaborate with the chipmaker on designing and manufacturing semiconductors in the United States. The announcement represents a significant validation of Intel's ongoing transformation into a contract manufacturer for external clients.
Trump made the disclosure on Truth Social, stating: "First, we helped bring in Nvidia, and they agreed to build their first level Chips with Intel. Next, Elon agreed to build his TerraFab, the largest Chip Factory in the World, designed together with Intel’s Technology team. And, finally, Apple has agreed to work with Intel to design and build its Chips in America." The news sent Intel shares up as much as 5.7% in overnight trading before settling at a 2.7% gain.
A Major Boost for Intel's Foundry Ambitions
An Apple contract would be the most prominent endorsement yet of Intel's effort to establish itself as a leading contract chip manufacturer. The Wall Street Journal reported in May that Intel had reached a preliminary agreement to produce some chips for Apple after more than a year of negotiations, a report that had already driven Intel's stock up by roughly 15% at the time.
This partnership would provide Intel with steady demand from one of the world's largest consumer electronics companies while bolstering the credibility of a foundry business that has struggled to compete with industry leader Taiwan Semiconductor Manufacturing Co. (TSMC). It would also mark a reunion between the two companies, years after Apple abandoned Intel-designed processors for Mac computers in favor of its own custom silicon.
Over the past year, Intel has secured agreements with the U.S. government and investments from firms including Nvidia and SoftBank as CEO Lip-Bu Tan works to revive the company's fortunes. For more on Intel's recent stock performance, see Intel Shares Hit Record $141.45 on Apple Chip Deal Reports, Mizuho Boost.
Jim Cramer Reiterates Bullish Stance
CNBC's Jim Cramer expressed confidence in Intel's trajectory during the CNBC Investing Club's monthly meeting on Wednesday. "Which stock do you want to buy? I told Club members the answer is my new favorite stock in this market: Intel," Cramer said. He urged investors to focus on future growth rather than past gains, noting that the rapid buildout of AI infrastructure could drive demand for processors beyond supply, giving chipmakers greater pricing power.
Cramer highlighted Intel's foundry business as a key driver, arguing that surging AI spending and capacity constraints at TSMC could push more chip designers toward alternative suppliers, particularly those offering U.S.-based manufacturing. "There's a revolution going on, and this revolution requires as many CPUs as possible," he added.
Apple Seeks Manufacturing Diversification
For Apple, an agreement with Intel could help diversify its manufacturing footprint amid exceptionally strong demand for advanced chip production. The iPhone maker relies heavily on TSMC, whose cutting-edge manufacturing lines are in high demand from AI chip developers like Nvidia and AMD. Apple has also accelerated its in-house silicon efforts, designing most key chips for iPhones, Macs, and other devices.
According to Creative Strategies analyst Ben Bajarin, Apple is TSMC's second-largest customer behind Nvidia. "Intel is the only place that can scale up capacity as a viable second source," Bajarin said in comments reported by CNBC last month. This perspective underscores the strategic value of Intel's foundry capabilities for Apple's supply chain resilience.
Manufacturing Advances Support Turnaround
Intel's foundry business has historically been plagued by manufacturing delays and yield concerns, raising doubts about its ability to serve external customers. However, Bajarin believes the company has moved past its most difficult period. "They've got through the rough patch and can now be considered validated as a credible second source," he said.
The Apple news follows Intel's unveiling of its new 18A-P manufacturing process, which the company claims delivers up to 9% higher performance, 18% lower power consumption, and 20% to 40% better thermal resistance compared to its existing 18A process. Intel noted that the 18A-P process has entered risk production, a low-volume phase where full wafers are produced to assess defect rates and performance before full-scale manufacturing begins.
Investor enthusiasm around Intel's turnaround has already driven the stock up more than 205% year-to-date, and an Apple partnership could provide another catalyst for the chipmaker's manufacturing ambitions. For broader market context, see S&P 500 This Week: Iran Deal Risks, Micron Earnings, and PCE Data in Focus and Apple Stock Under Scrutiny as Tim Cook Warns of Unavoidable Price Hikes on Memory Costs.
This article is for informational purposes only and does not constitute financial advice.
