Apple Plans to Develop Homegrown Bluetooth and Wi-Fi Chips

(Reuters) – Apple (NASDAQ:AAPL) is planning to switch to a homegrown chip for Bluetooth and Wi-Fi connections for its devices starting next year, a move that will phase out some parts currently supplied by Broadcom (NASDAQ:AVGO), Bloomberg News reported on Thursday.

The chip, code-named Proxima, has been under development for several years and is now slated to go into the first iPhones and smart home devices produced in 2025, the report cited people familiar with the matter.

The iPhone maker's in-house chips will be produced by Taiwan Semiconductor Manufacturing Co, the report added.

At its annual developer conference in June, Apple announced plans to use its own server chips to help power artificial intelligence features on its devices.

This move is separate from Apple's reported plans to launch its long-awaited series of cellular modem chips next year, which will replace components from longtime partner Qualcomm (NASDAQ:QCOM). However, the two parts will eventually work together, Bloomberg said on Thursday.

Apple did not immediately respond to Reuters' request for comment. Additionally, the company is collaborating with Broadcom to develop its first server chip, internally code-named Baltra, specifically designed for AI processing, the Information reported on Wednesday.

Despite in-house efforts, Apple and other tech giants have found it challenging to reduce reliance on Nvidia (NASDAQ:NVDA)'s pricey and short-supply processors for compute-heavy AI services.

Last year, Broadcom, a major supplier of wireless components to Apple, signed a multi-billion-dollar deal with the company to develop 5G radio frequency components.