The impact of Apple dumping Intel in Macs

“The financial impact of Apple’s potential move to dump Intel isn’t estimated to be that large,” Bill Maurer writes for Seeking Alpha. “According to Stifel analyst Kevin Cassidy, Apple only represented 4% of Intel’s revenues and 1% of profits last year.”

“Personally, I don’t think Intel bulls should take this as a shot against the company. While the Apple-Qualcomm relationship is extremely frosty, I don’t see a similar situation between Intel and Apple. I just believe this is a natural progression by Apple to bring more things in house, giving the company more control,” Maurer writes. “This probably is part of Apple’s plan for some of its cash pile, spending more on capital expenditures to build out required resources… The only way that this could have really hurt Intel moving forward is if Apple was planning on making a move down the PC price point ladder.”

“While the chipmaker would likely lose some revenues and profits, it’s not a major blow given all of the growth moves undertaken in recent years. For Apple, its a way to bring things in house more, allowing more control of product development,” Maurer writes. “In the end, that should tighten the Apple ecosystem, which means better products in the long run, a positive for shareholders.”

Read more in the full article here.

MacDailyNews Take: As we wrote earlier today:

It would hurt more than your average random beancounter would expect since Intel would no longer be included in the innovation leader’s personal computing designs.

Apple could come out with the next “MacBook Air” and Intel would have no earthly clue it was coming, dramatically slowing the ability of the PC dreck still using Intel’s constantly-delayed processors from knocking off Apple’s innovations.

Intel would be consigned to a bunch of Mac knockoff peddlers (HP, Lenovo, ASUS, Dell, etcetera). There are more benefits to being a part of computing’s innovation leader than mere units sold.

SEE ALSO:
Apple is moving on from Intel because Intel isn’t moving anywhere – April 3, 2018
Losing Apple’s Macs will hurt, but won’t kill Intel – April 3, 2018
Apple plans on dumping Intel for its own chips in Macs as early as 2020 – April 2, 2018
Apple is working to unite iOS and macOS; will they standardize their chip platform next? – December 21, 2017
Why Apple would want to unify iOS and Mac apps in 2018 – December 20, 2017
Apple to provide tool for developers build cross-platform apps that run on iOS and macOS in 2018 – December 20, 2017
The once and future OS for Apple – December 8, 2017
Apple ships more microprocessors than Intel – October 2, 2017
Apple embarrasses Intel – June 14, 2017
Apple developing new chip for Macintosh in test of Intel independence – February 1, 2017
Apple’s A10 Fusion chip ‘blows away the competition,’ could easily power MacBook Air – Linley Group – October 21, 2016
Ming-Chi Kuo: Apple to unveil new 13-inch MacBook, 13-inch and 15-inch MacBook Pros at ‘hello again’ special event – October 22, 2016
What to expect from Apple’s ‘hello again’ special Mac event – October 21, 2016
What Apple’s new MacBook Pro might have learned from iPhones and iPads – October 21, 2016
It’s official: Apple sends invitations for ‘hello again’ event on October 27th – October 19, 2016
Get ready, Apple’s new Macs are finally set to arrive! – October 19, 2016
All-new MacBook Pro, refreshed MacBook Air and iMac, and more coming at Apple’s October 27th special event – October 19, 2016
Apple plans to launch new Macs at special event on October 27th – October 18, 2016
macOS Sierra code suggests Apple could dump Intel processors in Macs for Apple A-series chips – September 30, 2016
Apple’s A10 Fusion chip miracle – September 20, 2016
The iPhone’s new A10 Fusion chip should worry Intel – September 16, 2016
Apple’s remarkable new A10, S2, W1 chips alter the semiconductor landscape – September 15, 2016

27 Comments

  1. It makes no sense that Apple had 4% of revenue impact but only 1% of earnings impact on intel. Apple buys the top margin processors. Besides, Apple’s cost for processors would drop significantly, maybe $150 per Mac. So, Mac prices could drop for $100, and Apple takes $50. And dropping Mac prices would hurt PC sales. Oh, and if the Macs are more powerful than PCs, that would hurt too…

    1. Intel makes many kinds of processors only a fraction of which are for PC/Macs. The majority of their processor revenue comes from those used in automotive, robotics, home appliances, toys, etc. It really is no surprise Apple’s contribution to revenue is reported to be so small.

  2. I think these ‘experts’ are being a little dismissive in their calculations. The potential damage is far greater than the bare figures and even the psycological effect of arguably the most innovative and magnetic brand user of its chips deserting. Fact is if it is successful in its alternative strategy it will not only show up Intel but will encourage other customers that they can/perhaps should desert them and go with Arm based alternatives for many perhaps most of their products. Once the market sees or even just imagines it sees such a trend, Intel could be considered to be in terminal decline.

    1. The other side of the coin is no native HW support for Windows. For those using Macs with a dual boot, Apple’s switch to their own processors will mean a virtualization layer must be used possibly leading to slower Windows response. As a result it may temporarily increase PC purchases in addition to Macs already installed.

      1. I’m not aware of any reliable statistics for how many Mac users boot into Windows, but I have no doubt that Apple has a pretty clear picture and will be making decisions accordingly.

        Obviously those who use Windows on Macs are a pretty vocal group on here, but I don’t know how representative they are of Mac users in general.

        1. I too am not aware of any reliable statistics for how many Mac users boot into Windows. However if being able to run Windows reliably in an Enterprise setting is a factor in Mac sales to businesses, changing the processor may have some negative effects on sales in that arena. Hopefully this change is not an example of the left hand not knowing what the right is doing.

          1. I don’t see Apple suddenly abanding Intel processors altogether. There’s no reason why the two types can’t exist side by side, with customers buying the version which best suits them.

            I would expect Apple to take a careful look at the resultant sales figures and plan their subsequent steps accordingly.

        2. Apple has a way of dealing with vocal groups 🙂 Apple knows they don’t have to satisfy these users, they just need to find NEW users to supplant them and they’ve been fairly successful at doing so. Those groups don’t necessarily get any quieter, they’re just drowned out by the massive wave of folks buying macOS that thinks virtualization is VR. And who only buy Apps from the App Store. And whose main use for their macOS device is FaceBook, email and Photos.

          Those folks aren’t representative of ALL Mac purchases, but if I was going to design a device specifically for a group, who do I design it for? The group that over the last few years have been actually BUYING MacBook Pro’s, iMacs, etc. in mass quantities OR the group that haven’t bought ANYTHING since the Mac mini?

        1. Good point. It may come down to if Apple’s modifications to their ARM processors cause any incompatibilities with Win10.

          Looking into Win10 for ARM it seems that in order to run most applications originally compiled for x86 it provides an emulation layer. For current Win10 on ARM devices it is recommended you only use Microsoft software, as everything emulated will run significantly slower. “Native performance like an Intel Core i3, emulated performance like an Intel ATOM.” Over time with faster processors this may not be a problem, but till then it may be best to avoid.

          https://www.windowscentral.com/who-are-windows-10-arm-powered-devices

          1. And according to that article, native ARM apps work fine, the big elephant in the room is the x86 emulation layer.

            I could see Apple providing Boot Camp Assistant to install Win 10 ARM, just like it does on its current Macs. IMO, both companies would mutually benefit. For Apple, it would give its user base the option to run Windows for those who need it; and for Microsoft, it would provide a huge credibility boost for its Windows ARM efforts.

  3. The more I think about this I’m softening my stance a bit.

    Software is no longer tied to one platform, even Microsoft has re-invented themselves and gone back to being a multi-platform developer.

    My latest asp.net project was developed on a macbook pro in visual studio. Without any code changes on my part its portable between visual studio on windows and the mac for coding and deployment. The production web app is running on Redhat Linux.

    We are approaching a time when underlying hardware won’t matter outside of very specific use cases.

    When Apple delivers an ARM based mac it may not matter that it’s not x86. Intel’s biggest blunder may end up being the sale of X Scale years ago.

      1. Much of the ‘native’ code you are concerned about would exist (using Really’s example) in the .NET libraries already optimized for the HW platform you are developing for. Most web development code actually runs on a software layer anyway and access HW via the API in the intervening layer(s) so doesn’t need to be optimized for any particular underlying HW layer.

          1. Possibly. It is rather well known now that Apple does keep certain API calls to only use for their own software. This came out when Uber was found to be using them (through some deal with Apple) to access user’s private info. Uber was allowed to use those internal APIs to better integrate with iOS and Maps. Unfortunately they also included calls that allowed invasion of privacy.

            If Apple is not careful, they will encounter the same situation Microsoft faced when it was revealed that they were using undocumented API calls for their Office suite to give them an unfair advantage. In one way Apple’s neglect of its own ‘home grown’ basic Apps has been ‘good’ for them showing no unfair advantage over 3rd party Apps.

      2. The underlying framework handles the optimizations for the most part, granted there will always be special use cases where you need tight code tuned for specific hardware but the vast majority of software out there does not fit that definition.

        Even on the gaming front, take unity for example, you can target multiple hardware platforms and the Unity framework takes care of the heavy lifting for each platform it supports.

  4. I still do not understand why Apple doesn’t just buy an x86 license and make their own x86 chips. With their know-how with their own current chip designs, I cannot imagine it would be hard for them to create better x86 chips than Intel…

  5. “innovation leader’s personal computing designs”

    How can MDN say that with a straight face? How old and out-of-date are the Mac Pro and Mini designs now? Three years? Three generations?

    ROTFLMAO

  6. If the change happens, it probably means the end of the Mac as a serious computer. I am sorry to see that and I will be looking at which Windows computer to buy. I don’t want to do this but I may be forced into it since my computer is not a toy.

  7. I can’t upgrade my Mac Pro if the replacement machine can’t run Win10.

    But I find I really couldn’t care. I don’t like the Jobsless Apple or its products as much as I did. Perhaps ithe time is approaching to de-Apple…

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