Intel shares (NASDAQ: INTC) are back on the move this morning, up strongly in pre-market, building on what has been a remarkable 2026 rally that has seen a new ATH above $100 for the first time. This morning’s action is driven by reports that Apple has held exploratory discussions with the chipmaker about producing main processors for its devices in the United States.
Intel shares are fresh off an all-time high of $100.45, and are up 3.3% in pre-market hours following the news. The stock has now surged 143% year-to-date in 2026, representing one of the most dramatic turnarounds in recent history, reflecting heightened optimism that the company’s costly foundry pivot may finally be gaining traction with tier-one customers.
Why Are Intel Shares Higher?
According to multiple media reports, Apple has conducted preliminary talks with both Intel and Samsung about manufacturing its custom-designed processors as a secondary option beyond longtime partner Taiwan Semiconductor Manufacturing Company. The discussions reportedly centre on utilising US based fabrication capacity, with Apple having evaluated Samsung’s under-construction Texas facility and engaging with Intel’s foundry services group.
The potential arrangement would represent a watershed moment for Intel’s foundry strategy, which Chief Executive Pat Gelsinger has positioned as central to the company’s long-term growth. Intel has invested tens of billions of dollars in new fabrication facilities in Arizona, Ohio, and other locations, supported by substantial CHIPS Act incentives aimed at repatriating advanced semiconductor manufacturing to American soil.
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Intel’s latest earnings materials highlight the start of 18A process node production wafers in Arizona, a critical milestone in the company’s roadmap to regain process leadership. The 18A node represents Intel’s bid to leapfrog TSMC’s manufacturing capabilities through innovations in gate-all-around transistor architecture and backside power delivery. Securing Apple as even a partial customer would provide crucial validation of these technological advances and help amortise the enormous capital expenditures required to build leading-edge capacity.
However, sources emphasised that Apple remains concerned about using non-TSMC technology, citing worries about reliability, manufacturing yields, and the ability to scale production to meet the iPhone maker’s demanding volume requirements. Neither Intel nor Samsung has received formal orders from Apple, and the discussions remain at an early, exploratory stage.
The backdrop to these talks is Apple’s growing unease about supply chain concentration risk. TSMC currently manufactures virtually all of Apple’s custom silicon, including the A-series chips for iPhones, M-series processors for Macs, and various other components. With TSMC’s advanced-node capacity increasingly constrained by demand from multiple customers and geopolitical tensions surrounding Taiwan escalating, Apple has clear strategic incentives to develop alternative manufacturing relationships.
Intel Gaining Attention
Intel’s foundry ambitions have attracted attention from other potential customers and partners in recent months. The company has secured design wins for its 18A process from several unnamed customers and has discussed potential investment and deeper cooperation with major technology firms. Nvidia and SoftBank have been mentioned in industry reports as parties exploring various forms of collaboration with Intel’s foundry services.
The competitive landscape remains challenging. TSMC continues to command the majority of leading-edge foundry market share, with industry analysts consistently rating its process technology and manufacturing execution as best-in-class. Samsung, despite years of effort, has struggled to close the gap with TSMC at the most advanced nodes, experiencing yield issues that have cost it business from major customers including Qualcomm.
For Intel, the technical hurdles are substantial. The company’s process technology stumbled badly in the previous decade, with repeated delays to its 10-nanometre and 7-nanometre nodes allowing TSMC to seize leadership. While Intel’s recent roadmap execution has improved under Gelsinger’s leadership, the company must now demonstrate that it can deliver competitive yields and performance at scale, precisely the concerns Apple reportedly harbours.
What This could Mean for INTC
If Intel were to secure even a portion of Apple’s processor manufacturing, the financial impact could be transformative.
Apple ships hundreds of millions of iPhones annually, along with tens of millions of iPads and Mac computers. Even capturing production of entry-level or lower-tier devices would represent multi-billion-dollar annual revenue potential at high-margin advanced nodes.
More importantly for Intel’s valuation, such a win would fundamentally alter the market’s perception of the company’s foundry business model. Currently, Intel’s foundry services division operates at a loss as the company invests heavily in capacity and technology development. A credible path to attracting hyperscale fabless customers would support the thesis that Intel can eventually achieve profitability and returns on invested capital comparable to TSMC’s industry-leading metrics.
However, the bear case centres on execution risk and opportunity cost. Intel’s capital expenditure programme remains among the most aggressive in the semiconductor industry, with spending expected to remain elevated for several more years. If the company fails to win major external foundry customers, or if its process technology continues to lag TSMC, these investments could result in underutilised capacity and poor returns, pressuring margins and cash flow.
The transformation in sentiment in Intel shares has been dramatic, and the 2026 gain is part of a story that began last year, with shares now 372% higher on a 1 year basis. There appears to be consensus that the company is making genuine progress in its turnaround efforts and growing market conviction that the company can reclaim a leadership position in semiconductor manufacturing. The Apple opportunity in and of itself, while interesting, remains speculative, and the technical and execution challenges facing Intel’s foundry ambitions remain formidable.
Bull Case:
- Apple talks validate Intel foundry as credible alternative to TSMC monopoly
- CHIPS Act support and geopolitical tailwinds create structural demand for US capacity
- Even partial Apple business would drive multi-billion high-margin foundry revenue stream
- 18A production milestone demonstrates improved execution under Gelsinger turnaround strategy
- Multiple expansion justified by optionality across foundry, AI datacenter growth drivers
Bear Case:
- Discussions remain exploratory with no committed orders or production timelines yet
- Technical and yield gap versus TSMC persists despite recent roadmap progress
- Execution risk remains high given Intel’s history of process delays
- Stock trading at stretched valuations after 143% rally leaves limited margin for error
- Massive capex programme creates underutilisation risk if foundry customers fail to materialise
