Apple mulls ditching Intel for own chips

Shift would be a blow to Intel, whose partnership helped revive Apple’s Mac success

Apple Inc. is planning to use its own chips in Mac computers beginning as early as 2020, replacing processors from Intel Corp., according to people familiar with the plans.

The initiative, code named Kalamata, is still in the early developmental stages, but comes as part of a larger strategy to make all of Apple’s devices — including Macs, iPhones, and iPads — work more similarly and seamlessly together, said the people, who asked not to be identified discussing private information. The project, which executives have approved, will likely result in a multi-step transition.

The shift would be a blow to Intel, whose partnership helped revive Apple’s Mac success and linked the chipmaker to one of the leading brands in electronics. Apple provides Intel with about 5 per cent of its annual revenue, according to Bloomberg supply chain analysis.

Intel shares dropped as much as 9.2 per cent, the biggest intraday drop in more than two years, on the news. They were down 6.4 per cent at $48.75 (Dh179).

Apple could still theoretically abandon or delay the switch. The company declined to comment. Intel said, “We don’t comment on speculation about our customers.”

Moving to its own chips inside Macs would let Apple release new models on its own timelines, instead of relying on Intel’s processor road map.