CUPERTINO (dpa-AFX) - Tech major Apple Inc. announced a new multi-year, over $30 billion worth deal with chipmaker Broadcom Inc. to produce more than 15 billion U.S.-made chips, aiming to accelerate manufacturing in the U.S.
In the pre-market hours on the Nasdaq, Apple is trading 0.15 percent lower at $310.20, while Broadcom is gaining 0.29 percent, trading at $371.84.
Earlier this week, Broadcom shares had climbed after announcing its decision to extend its long-term technology collaboration with Apple through 2031 to develop and supply a range of custom ASIC silicon products.
The iPhone maker now said the new agreement, extending their earlier partnership, will see Broadcom designing and producing custom silicon components and cutting-edge wireless connectivity technologies for a wide range of Apple products.
The deal is expected to support hundreds of jobs for Americans, as it will enable Broadcom to expand and modernize its manufacturing facilities in Fort Collins, Colorado, with a $1.5 billion capital expenditure investment.
Broadcom will produce advanced radio frequency components, including FBAR filters, and advanced wireless connectivity technologies at the Fort Collins facility.
Apple CEO Tim Cook said, 'The cutting-edge components built in Fort Collins are essential to delivering the incredible performance and connectivity our customers expect, and we're proud to deepen our investments in U.S.-based suppliers that share our commitment to excellence and innovation.'
Broadcom has been the initial partner of Apple's American Manufacturing Program or AMP, a key part of its four-year commitment to invest $600 billion to U.S. economy to boost manufacturing, job creation, and technology development across the country.
The tech major said the new agreement marks its largest AMP commitment so far.
Apple noted that it has been working with the administration and businesses across the U.S. to help create an end-to-end silicon supply chain in America.
In late March, Apple added new partners, Bosch, Cirrus Logic, TDK, and Qnity Electronics, to AMP, aiming to manufacture essential materials and components in the U.S. for Apple products and to strengthen the tech major's domestic supply chain.
Apple then said it plans to spend $400 million for these new programs through 2030, which would create jobs and strengthen the manufacturing capabilities in the country.
Along with Broadcom, AMP's initial partners in AMP include Amkor, Applied Materials" Coherent, Corning, GlobalFoundries, GlobalWafers America, MP Materials, Samsung, and Texas Instruments.
The iPhone maker last year had committed to invest $600 billion in the U.S. over the next four years. Earlier, U.S. President Donald Trump had threatened the tech firm with a 25 percent tariff on products manufactured overseas.
Apple's most products, including iPhones and iPads, are manufatured in Asia, primarily in China, while some production have been shifted to Vietnam, Thailand and India in recent years.
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