Shares of Intel surged over 14% on Friday following reports of a preliminary chip manufacturing agreement with Apple, a deal that took shape after more than a year of intensive negotiations. The Trump administration’s strategic stake in Intel, now valued at $56.5 billion, was instrumental in propelling the talks forward and bolstering investor confidence.
The agreement, finalized in recent months according to sources cited by the Wall Street Journal, could see Intel produce chips for some of Apple's devices, though the specific products remain undisclosed. The news sent Intel's stock rocketing, while Apple shares advanced about 2%, and the S&P 500 index crossed the 7,400 mark for the first time.
Intel’s resurgence has been fueled by a broader turnaround strategy under CEO Lip-Bu Tan, who took the helm in March last year. The company reported first-quarter revenue of $13.6 billion, up 7% year-on-year, with adjusted earnings per share of $0.29 far exceeding estimates. Tan highlighted that 'the next wave of AI will bring intelligence closer to the end user,' driving demand for Intel's CPUs and advanced packaging.
Beyond the Apple deal, Intel has cemented other high-profile partnerships, including manufacturing processors for Elon Musk's Terafab initiative with Tesla and SpaceX, and gaining regulatory approval to expand its investment in AI chip developer SambaNova Systems. These moves underscore Intel's aggressive push to become a major contract chip manufacturer, challenging established foundry players.
