The idea of Intel manufacturing Apple's proprietary A-series chips isn't new—the rumor mill broached the subject a year a and half ago. According to a Credit Suisse analyst quoted by Forbes, however, this hypothetical partnership could actually work.
Credit Suisse's John Pitzer ran the numbers and found that, although Intel's foundry business has a higher cost per wafer than TSMC, the world's biggest contract foundry, Intel's bottom line would benefit from a manufacturing partnership with Apple. Here's the snippet from the Forbes piece:
His view: If Intel were to produce 100% of Apple's demand at 14 nm the company generate an extra $5.8 billion in revenue, 47% gross margins (which is below the 60%-65% of the core business) but with operating margins of 35%, above the core of 28%-32%. He thinks that arrangement would produce an extra 28 cents a share in annual profits, with an ROI of 20%-25%.
Intel has opened up its fabs before. As Forbes points out, Intel Foundry Services builds chips for three little-known firms: Acrhnoix, Tabula, and Netronome.
Apple currently relies on Samsung to manufacture its chips, but Forbes says "the scuttlebutt is that Apple has been looking for alternatives." Given the vicious litigation between the two companies, that's hardly surprising.
A partnership with Intel might be beneficial to Apple, especially if Intel's foundry business remains ahead of the rest of the industry. Pure-play foundries may be catching up, though. X-bit labs says GlobalFoundries is planning for early 14-nm tape-outs in late 2013. A story by The Register posted around the same time said Intel's 14-nm process is "on track for production readiness around the end of next year."