Apple commits over $30 billion to Broadcom to produce billions more US chips
Apple said Wednesday it is expanding its partnership with chipmaker Broadcom through a multi-year deal expected to exceed $30 billion, marking the iPhone maker’s largest U.S. manufacturing commitment to date.
The deal will enable the production of more than 15 billion U.S.-made chips and include a $1.5 billion expansion of Broadcom’s facility in Fort Collins, Colorado. However, Apple has not yet provided a timeline for when the new production capacity will come online.
“The new agreement, expected to exceed $30 billion, will lead to the production of more than 15 billion U.S.-made chips and support hundreds of American jobs,” Apple said in a press release.
Broadcom to produce wireless connectivity components in the US
Broadcom has long supplied connectivity components to Apple, but the new deal expands the partnership to include custom US-made silicon, according to CNBC. Apple said Broadcom will produce wireless components that allow its devices to connect to cellular, Wi-Fi and Bluetooth networks.
“Apple and Broadcom have a long history together, and this new phase of our partnership further accelerates our commitment to American manufacturing and innovation,” said Tim Cook, Apple’s CEO.
“State-of-the-art components built in Fort Collins are essential to delivering the incredible performance and connectivity our customers expect, and we are proud to deepen our investments in U.S.-based suppliers who share our commitment to excellence and innovation,” he added.
$600 billion US investment promise from Apple
According to the statement, Apple has been working with governments and businesses across America to help build an end-to-end silicon supply chain in the country, and the latest announcement furthers those efforts.
These investments are part of Apple’s commitment to invest $600 billion in the U.S. economy over four years and support manufacturing, job creation and technology development across the country.
Broadcom also announced in a filing with the Securities and Exchange Commission on Monday that it has signed new long-term agreements with Apple to develop and supply “custom ASIC silicon products” for multiple generations of Apple products through 2031.
ASICs are highly specialized microchips built specifically for a specific function. While CPUs and GPUs handle a variety of tasks, ASICs maximize performance and energy efficiency for specific algorithms, such as neural networks. They are increasingly used for AI workloads in the current technology environment.
“With Apple’s newest commitment, we are pleased to expand our manufacturing footprint in Fort Collins, where we are creating breakthrough technologies that connect people around the world,” said Hock Tan, president and chief executive officer of Broadcom.
