Apple (Nasdaq: AAPL), the world's most valuable technology company, has been selling the iPhone 5 with the new, A6 processor inside, since Sept. 21. The processor is more powerful than any of its predecessors.
That led to speculation a month ago that Apple might rely exclusively on the A6 and its successors from longtime partner ARM Holdings of the UK, severing a supply tie with Intel Corp. (Nasdaq: INTC), the world's top chipmaker.
Intel, of Santa Clara, Calif., has been the supplier of chips for Apple Macs and Macbook products, if not for its iPhones and iPad products.
Analysts agree that Apple's shift to independent design is inevitable. “We don't believe it will likely happen for a few years,” said Shaw Wu, of Sterne Agee.
Wu said continued strong demand for iPhone 5 and the iPad family, including the new iPad Mini, may convince Apple, of Cupertino, Calif., that it's strong enough to design its own products, even though it will never make its own chips.
At Piper Jaffray, analyst Gus Richard agreed the idea has legs. "There's a trend back to internally developed silicon away from merchant silicon," he said.
Shares of ARM Holdings, Apple and Intel all weren't much affected by the renewed speculation. But shares of ARM, now at $33.96, have gained nearly 18 percent in the past month since the speculation began. Apple shares, at $585.55, have fallen more than 10 percent, and Intel, at $21.70, has fallen more than 4 percent.
Last month, Apple CEO Tim Cook created a new internal unit, Techologies, and assigned Bob Mansfield, a senior VP and electrical engineer, to manage it. The move came after Senior VP Scott Forstall was fired for mistakes in shipping iPhone 5 without an adequate map system to replace Google (Nasdaq: GOOG) Maps.
Semiconductor expert Linley Gwennap has examined the new A6 chip and determined that Apple engineers have tweaked it.