Apple to Make Their Own Processors for All Products

Good news everybody, apple is planning to use its own chips in Mac computers beginning as early as 2020, replacing processors from Intel , according to people familiar with the plans.

Code Name Kalamata

The initiative, code named Kalamata, is still in the early developmental stages, but comes as part of a larger strategy to make all of Apple’s devices — including Macs, iPhones, and iPads — work more similarly and seamlessly together, said the people, who asked not to be identified discussing private information. The project, which executives have approved, will likely result in a multi-step transition.

The shift would be a blow to Intel, whose partnership helped revive Apple’s Mac success and linked the chipmaker to one of the leading brands in electronics. Apple provides Intel with about 5 percent of its annual revenue. That’s not an unnoticeable hit. Intel’s stock dropped sharply on Monday after Bloomberg reported that Apple would ditch Intel chips for an in-house model on Mac computers.

“The market is over reacting to Apple’s announcement for using an internally developed CPU for its Mac systems as early as 2020,” analyst Kevin Cassidy wrote in a note to clients entitled “Potential Apple Move Not a Major Threat to Intel” on Monday. “According to IDC, Apple had 7.3% traditional PC unit market share in 4Q17.

“We think that Apple is looking at ways to further integrate their hardware and software platforms, and they’ve clearly made some moves in this space, trying to integrate iOS and macOS,” said Shannon Cross an analyst at Cross Research. “It makes sense that they’re going in this direction. If you look at incremental R&D spend, it’s gone into ways to try to vertically integrate their components so they can add more functionality for competitive differentiation.”

The Final Thought

Many of us remember when Apple made their own chips previously. There G line chips where far superior to intel’s and created the Mac resurgence in the early part of the century. Apples A series chip far out perform anything snapdragon cant slap out, so this is a welcome hurrah.