Apple extends Broadcom partnership to strengthen long-term chip supply

Broadcom has agreed to extend its partnership with Apple through 2031 to develop and supply a range of custom chips, sending the chipmaker's shares up nearly 4 percent in pre-market trading.

The chipmaker has long been one of Apple's key component suppliers. Over the years, it has supplied the company with custom radio frequency (RF) chips, Wi-Fi and Bluetooth connectivity chips, and a range of other networking semiconductors used across Apple's product lineup.

According to analysts, Apple accounts for nearly 20 percent of Broadcom's annual revenue, making the iPhone maker one of the chipmaker's most important customers. The extended partnership reinforces Apple's strategy of securing long-term supply agreements with key semiconductor partners to strengthen the resilience of its supply chain.

In 2023, Apple and Broadcom announced a multi-billion-dollar agreement under which the chipmaker would develop and manufacture 5G radio frequency components in the United States. The latest extension further deepens the long-standing relationship between the two companies.

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The partnership builds on Apple's long-standing collaboration with Broadcom. In 2023, the two companies signed a multi-billion-dollar agreement under which Broadcom would develop and manufacture 5G radio frequency components, including FBAR filters and advanced wireless connectivity technologies, in the United States.

The initiative formed part of Apple's broader commitment to strengthen domestic manufacturing and expand investments in the US supply chain. Apple had also said the collaboration would support jobs, automation projects, and the development of next-generation 5G technologies, reinforcing its strategy of working closely with American semiconductor manufacturers.