Intel Surges 100% in a Month on Apple Foundry Deal

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•  08 May 2026
 

$INTC Intel Corp continues to climb at an unusual pace, driven by a combination of chip sector enthusiasm, rising demand for AI-related processors, and reports of a preliminary agreement with Apple to manufacture chips. The stock surged roughly 14%, reaching approximately $125, completing a gain of more than 100% within a single month after already posting sharp gains year-to-date and over the trailing 12 months. The move marked a fourth consecutive intraday high, with earnings momentum and institutional flows reinforcing the rally at every step.

The catalyst behind the latest leg higher is a preliminary agreement between Intel and Apple, under which Intel would manufacture a portion of the chips used in Apple devices. Negotiations between the two companies reportedly lasted more than a year, with a formal preliminary agreement taking shape in recent months. It remains unclear which specific chips Intel would produce for Apple or which product lines they would be integrated into, whether iPhones, iPads, Macs, or other categories.

For Intel, the prospect of working with Apple represents a meaningful test of its foundry ambitions. The company has been working to attract large external customers to its manufacturing facilities rather than relying solely on chips it designs internally. Apple, which ships more than 200 million iPhones annually alongside millions of iPads and Macs, is the kind of customer that could provide Intels foundry division with both revenue and market credibility.

The potential deal comes as Apple seeks to diversify its supply chain. The company currently relies heavily on TSMCs Taiwan operations to manufacture the chips it designs for the iPhone, iPad, Mac, and other products. Growing demand for TSMC capacity from Nvidia and other AI companies has reduced Apples room to maneuver, as it previously held a stronger position as a key customer. Tim Cook has referenced chip supply constraints in recent earnings calls, noting that limited availability of advanced chips affected the availability of certain Mac models.

The US government played a central role in advancing the arrangement. Commerce Secretary Howard Lutnick held repeated meetings with Apple executives including Tim Cook, as well as with Elon Musk and Jensen Huang, to encourage partnerships with Intel. President Donald Trump personally promoted the idea with Cook in a White House meeting. From Washingtons perspective, strengthening Intel is not purely a commercial matter but part of a broader effort to reestablish advanced chip manufacturing capacity in the United States.

The move fits within a broader repositioning of Intel since Lip-Bu Tan assumed the chief executive role. After the Trump administration converted nearly $9 billion in federal grants into Intel equity and received approximately a 10% stake in the company, Intel attracted additional partners. Nvidia invested $5 billion and announced a collaboration on processors tailored for data centers, while Elon Musk announced a plan with Intel to build a manufacturing facility in Texas as part of the Terafab project.

Friday was a strong session for chip stocks broadly, with Intel, Micron, and Nvidia each approaching roughly $100 billion in added market value in a single day. Broadcom and AMD also gained, and together the leading chip stocks were on track to add more than $400 billion in combined market capitalization in one session. The driver behind the enthusiasm remains the same central thesis: demand for artificial intelligence infrastructure, and the question of whether Intel can participate meaningfully in the next phase.

Intel had previously been seen as having missed the AI accelerator wave that made Nvidia the dominant player. Investors are now evaluating whether Intels core processors, particularly for the data center market, can benefit from the next phase of the cycle, the shift from model training to broad deployment of AI inference workloads and AI agents. Chief Executive Lip-Bu Tan has framed this as an opportunity, arguing that the next wave of AI will move capabilities closer to end users and increase demand for CPUs, silicon wafer production, and advanced packaging, precisely the areas where Intel is seeking to reestablish relevance.

Recent results provided partial support for that narrative, with Intel reporting first-quarter adjusted earnings of $0.29 per share, above estimates, and revenue of $13.58 billion, also ahead of expectations. The Data Center and AI division reinforced the case that demand for Intels processors is regaining relevance in an AI-focused market. Multiple expansion has become a key factor in the stocks move, though it also raises questions: Intel trades at a forward price-to-earnings multiple of approximately 119, while the average analyst price target sits near $80.93, meaningfully below the current share price, suggesting a significant portion of professional market participants still struggle to justify current valuation levels.

Despite government support and new partnerships, Intel still needs to demonstrate it can manufacture chips at the quality, speed, and cost required to compete with TSMC. Market estimates suggest Intels manufacturing costs remain significantly higher than the Taiwan-based competitor, in part due to lower yields per production cycle. Intel has reported improvements in its new 18A manufacturing process, but the company has not reached the point where it can credibly claim the gap with the leaders has closed.

The Apple agreement, if it advances, would not eliminate those challenges. On the contrary, a customer of that caliber would demand precise execution from Intel: adherence to timelines, consistent manufacturing quality, high output, and the ability to supply components at scale. The agreement could therefore serve as meaningful validation of Intels recovery plan, but also as a demanding test of its ability to meet expectations. Internally, executives brought in by Tan describe an organization that needs to recover a sense of urgency, one that was long accustomed to setting the pace of the industry but in recent years has had to adjust to a different position, not the rule-setter, but the challenger trying to return to competition.

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