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Analyst: Apple can save $500 million a year replacing Intel chips with its own

Following that Apple will replace Intel chips in Macs with its own custom-made chips in 2020, Bank of America Merrill Lynch estimates the company can save $500 million each year if it goes this route for even half its Macs.  

The “insourcing of chips could benefit Apple by not being dependent on Intel’s processor cycles, by lowering the Mac costed bill-of-materials by ~$40-50, and by potentially streamlining and reducing R&D spend,” analyst Wamsi Mohan wrote in a note to clients.

He added that Apple can improve its product development times if it uses its own chips.

“The benefit to Apple would be two-fold: 1) aggregating development across iOS and MacOS can help lower the overall cost of R&D by potentially combining development teams and potentially reducing time to market for new products and Apps, and, 2) internally developing the processor can help save some cost vs. purchasing the processors from Intel,” Mohan adds.

Dennis Sellers
the authorDennis Sellers
Dennis Sellers is the editor/publisher of Apple World Today. He’s been an “Apple journalist” since 1995 (starting with the first big Apple news site, MacCentral). He loves to read, run, play sports, and watch movies.