- Apple extends Broadcom partnership to supply chips until at least 2031
- Development for next-generation C2 modem could still be underway
- Broadcom and Apple investors are happy as shares rise
Apple has extended its partnership with Broadcom to supply it with chips until 2031, signing new agreements covering chip development and supply for upcoming generations of the company's own silicon.
Broadcom remains a key supplier of radio (RF) chips, Wi-Fi chips, Bluetooth chips and other networking hardware, even though Apple has successfully replaced several components with in-house alternatives like its high-performance M-series chips and recent C-series cellular modems.
By signing Broadcom up for another five years, it may indicates Apple doesn't yet have immediate plans to replace all chips with in-house production, spelling out good news for third-party suppliers.
Apple will still use Broadcom to source many chips
The extension is major news for Broadcom in particular, which credits around a fifth of its revenue to supplying Apple. The extension through 2031 provides the chipmaker with long-term revenue visibility and greater certainty for future product planning.
For Apple, it means more time to develop its own silicon with guaranteed supply from Broadcom. "locking in Broadcom through 2031 buys supply-chain certainty at a moment of chip scarcity, and spares Apple from having to in-source key iPhone components," Emarketer analyst Jacob Bourne commented (via Reuters).
However, vague wording around custom ASIC silicon has led some to believe that Apple could be exploring broader chip production from Broadcom including AI accelerators and other AI-supporting hardware.
Broadcom shares rose around 4% following the announcement, confirmed by Reuters. Apple shares are also back up, after a slight dip following the company's annual developer conference WWDC.
Looking ahead, Apple is believed to be working on a next-generation C2 modem that could even support mmWave, meaning it could be added into more devices like the full iPhone 18 family, ultimately reducing the need for third-party supply.
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