Apple logo./Courtesy of Reuters

Apple is developing server chips for artificial intelligence (AI) processing in collaboration with U.S. semiconductor corporation Broadcom, the information technology (IT) news outlet The Information reported on Nov. 11 (local time).

Sources noted that Apple’s AI chip development is internally codenamed ‘Baltra’ and is expected to enter mass production in 2026. They added that the production of these chips will utilize one of Taiwan Semiconductor Manufacturing Company’s (TSMC) latest processes, called 3-nanometer (N3P).

Broadcom is a global semiconductor and infrastructure software solutions corporation that designs and develops high-performance semiconductors and software products used across various industries. It ranks 10th by market capitalization on the New York Stock Exchange.

Apple also signed a multi-year, multi-billion dollar contract with Broadcom last May to develop 5G (fifth generation mobile communication) radio frequency (RF) components and advanced wireless access components.

Apple’s development of its own AI chips is analyzed as a move to reduce dependence on NVIDIA, which holds over 80% of the global AI chip market. Previously, at the annual Worldwide Developers Conference (WWDC) in June, Apple announced plans to use its server chips to power AI capabilities.

Apple is using its own developed chips (system on a chip) called ‘Apple Silicon’ in all its devices, including the iPhone. While Apple has historically used Intel chips in its desktop and laptop PCs, such as the iMac and MacBook, it has replaced them with its own developed M-series chips.

On the day Apple and Broadcom’s collaboration news was announced, Apple's stock price fell 0.52% on the New York Stock Exchange, while Broadcom's stock price surged 6.63% compared to the previous day.