Broadcom extends Apple chip partnership through 2031, stock climbs 5%

Broadcom Inc. shares rose 5.3% in trading on Monday after the semiconductor company announced an extension of its long-standing partnership with Apple Inc. through 2031.

The agreement reinforces Broadcom's position as one of the iPhone maker's key chip suppliers.

The new multi-year agreement expands the companies' collaboration on custom silicon products and provides Broadcom with long-term revenue visibility from one of its largest customers.

Apple accounts for about 20% of Broadcom's annual revenue, according to analysts, making the partnership strategically important for the chipmaker.

Broadcom secures long-term Apple partnership

Broadcom said it has agreed to expand its partnership with Apple through 2031 to develop and supply custom chips, easing concerns over the iPhone maker's reliance on the semiconductor company.

According to Broadcom's recent SEC filing:

"Broadcom Inc. (“Broadcom”) and Apple Inc. (“Apple”) have agreed to expand their long-standing technology collaboration through 2031 by entering into new multi-year long-term agreements for Broadcom to develop and supply a range of custom ASIC silicon products for use in multiple generations of Apple products."

The agreement covers a range of custom silicon products that will be used across multiple generations of Apple devices.

Financial terms of the extension were not disclosed.

Broadcom has supplied Apple with key components for years, including radio frequency chips that enable iPhones to connect to cellular networks, Wi-Fi and Bluetooth connectivity chips, and other networking semiconductors.

Although Apple has developed several in-house chips, including its C1 modem, it continues to rely on Broadcom for wireless and radio-frequency components.

The companies had previously announced a multibillion-dollar agreement in 2023 for Broadcom to develop and manufacture 5G radio frequency components.

The latest extension builds on that relationship and secures Broadcom's role in Apple's supply chain through the end of the decade.

Apple navigates chip supply challenges

The extended partnership aligns with Apple's strategy of securing long-term supply agreements with key semiconductor companies to strengthen the resilience of its supply chain.

Apple relies on Taiwan's TSMC, the world's largest contract chipmaker, to manufacture its in-house processors, including the M-series chips used in Mac computers and the A-series processors that power iPhones.

Demand for advanced chips has intensified as artificial intelligence adoption accelerates.

The growth of AI inference—the process by which models respond to user queries—has increased demand for custom chips and advanced processors, creating greater competition for manufacturing capacity.

TSMC has faced heavy demand from AI chipmakers such as Nvidia. Apple Chief Executive Tim Cook said in April that these capacity constraints had affected iPhone sales.

Apple is also in discussions with Intel to manufacture some chips in the United States, although analysts have said volume production is unlikely before late 2027.

AI demand drives semiconductor market

The broader semiconductor industry has experienced rising component costs as AI infrastructure spending continues to expand.

Prices for memory and storage chips have climbed sharply in recent months, driven by increasing demand from AI hyperscalers.

Apple raised prices for its MacBooks and iPads in June after memory chip costs surged as much as 98% during the first half of 2026.

Beyond its relationship with Apple, Broadcom has been expanding its presence in the artificial intelligence market by developing AI-specific chips for other major technology companies, including Alphabet and Meta Platforms.