After locking in a $5 billion investment from Nvidia and another $2 billion from SoftBank, Intel reportedly wants Apple as its next major backer.
Apple was once a long-time customer of Intel. However, it eventually shifted to its own in-house chips after Intel failed to innovate quickly enough.
Intel begs Apple for money
Intel once dominated the CPU market, but the last decade tells a different story. The chipmaker has struggled to deliver meaningful breakthroughs in computing performance, while smaller rival AMD has surged ahead in both power and efficiency. As a result, longtime partners and vendors have begun looking elsewhere, frustrated by Intel’s stagnation.
All this has affected Intel’s bottom line, forcing the company to reduce its spending significantly. Earlier this year, it cut 15% of its workforce to save money. Even the U.S. government picked up a 10% stake in the chipmaker last month. Now, fresh after securing a $5 billion investment from Nvidia, Intel is seeking a big investment from Apple.
As Bloomberg reports, both companies are in the early stages of negotiations, with Apple not committing to anything yet. They have also discussed how they can work together more closely.
Given the strained history between the two companies, it would be interesting to see if Apple makes any investment commitment to Intel. And even if it does, there’s no chance Apple would go back to using Intel chips in its devices.
Intel needs more than money to survive
Apple executives previously explained in detail why they moved away from Intel to Apple silicon for their products. The decision paid off, with Apple silicon-powered Macs setting a new benchmark in performance and efficiency.
Intel CPUs, meanwhile, failed to keep pace with the rapid progress of Apple’s chips. The chips often face criticism for excessive power consumption and underwhelming year-over-year performance improvements. This widening gap between Intel chips and Apple silicon has only reinforced Cupertino’s decision to cut ties and chart its own roadmap.
Beyond CPUs, Intel also supplied Apple with baseband chips for iPhones. However, Intel’s failure to deliver a 5G modem on schedule forced Apple to strike a multiyear licensing deal with Qualcomm (after settling a legal dispute). Following this failure, Intel sold its modem business to Apple for $1 billion and exited the baseband market entirely.
Even if Intel lands an investment from Apple, it won’t be enough to end the chipmaker’s troubles. What the company needs is to spend that money wisely and get back to innovating.
Rajesh has been closely following and writing about the latest happenings in the world of mobile for nearly a decade now. While he prefers Android, he does not deny the superiority of Apple’s products and ecosystem.
