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Investment Moves in Intel
Intel (NASDAQ: INTC) has attracted significant investments recently, totaling $15.9 billion. The U.S. government invested $8.9 billion for a 10% equity stake, while SoftBank contributed $2 billion and Nvidia added $5 billion in September 2023. Additionally, reports indicate that Apple (NASDAQ: AAPL) is in preliminary discussions with Intel about a potential investment, although the amount and nature of any collaboration have not been disclosed.
Context of Intel and Apple Relationship
Intel and Apple had a longstanding partnership dating back to 2006 when Intel began manufacturing Apple’s processors. However, Apple shifted to in-house chip production beginning in 2020, phasing out Intel components by 2023. Given Apple’s existing collaboration with Taiwan Semiconductor Manufacturing and its recent commitment of $600 million to U.S. manufacturing investments, the rationale behind an investment in Intel remains unclear.
Market Reaction
Following the news of potential discussions between Intel and Apple, Intel’s stock rose by 6%, while Apple’s shares decreased by 1%. This suggests investor confidence in the potential partnership benefiting Intel more than Apple, which faces little incentive to reinvest in a previously abandoned supplier.
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