Intel Corporation (INTC) shares surged 10.6% on Thursday, closing at a record high near $134, following an announcement by President Donald Trump that Apple Inc. (AAPL) will collaborate with Intel on chip design and manufacturing in the United States. The rally added approximately $65 billion to Intel's market capitalization, significantly outpacing the broader market.
The stock traded in a range of $127.90 to $135.48 during the session. The news comes as Intel's foundry business, Intel Foundry, reported a first-quarter operating loss of $2.44 billion, with only $174 million in revenue from external foundry and assembly services. A potential contract with Apple could help fill unused fabrication capacity and provide Intel with a marquee customer to attract other chip designers.
President Trump's statement did not include any commercial terms, production details, or timelines. Neither Intel nor Apple has commented on the reported deal. Wedbush analyst Dan Ives described Apple's reported move as "strategic" and suggested that Trump's post indicates "a deal is now in place," though this remains unconfirmed by either company.
18A-P Process Milestone
Intel also announced that its advanced 18A-P chip manufacturing process has reached "risk production," an early stage where the company tests for defects and refines the process before mass production. Intel claims the technology can deliver a 9% performance boost without additional power consumption, or an 18% power savings at the same performance level. Intel Foundry head Naga Chandrasekaran noted, "This is a journey," adding that there is "more work ahead."
Broader Business Momentum
Beyond the Apple news, Intel is seeing stronger demand in other segments. The company now expects second-quarter revenue between $13.8 billion and $14.8 billion, exceeding the average analyst estimate of $13.07 billion from LSEG. AI service providers are increasing orders for central processing units (CPUs), which handle server workloads.
The broader tech sector also rallied, with the Nasdaq Composite climbing 1.9%. Advanced Micro Devices (AMD) rose 4.7%, and Nvidia (NVDA) gained 2.8%, as semiconductor stocks rebounded with the market.
Market Implications and Risks
Investors are viewing the potential Apple partnership as a validation of Intel's manufacturing capabilities, which could persuade other chip designers to use Intel's foundry services. However, the key challenge remains achieving manufacturing yields comparable to those of Taiwan Semiconductor Manufacturing Co. (TSM), which has been Apple's primary chip supplier for its M-series processors since Apple transitioned away from Intel-designed chips in 2020.
Bernstein analyst Stacy Rasgon cautioned that Intel's initial work with Apple likely involves "low-volume, less important parts." With Intel shares up approximately 263% year-to-date, there is limited downside protection if the ramp is slow, yields disappoint, or margins are thin. Any delays or if Apple limits its engagement to secondary components could erase Thursday's gains.
Nasdaq will be closed on Friday, June 19, for Juneteenth. Trading resumes Monday, with investors awaiting written confirmation from Apple or Intel, as well as details on the process node, production schedule, expected output, and pricing. These specifics will be crucial to determine whether Thursday's record close is sustainable or merely early hype.
