Apple’s newest iPhone Air reached stores on Friday, and the custom chips installed to these phones point to a bigger push into artificial intelligence.

Apple’s new A19 Pro chip is bringing a major shift in design. Each GPU core now includes neural accelerators to lift AI performance. Two other chips are debuting in iPhone: the N1, Apple’s first wireless chip for iPhone, and the C1X, the second generation of Apple’s in-house modem.

Apple is moving towards chips customized for AI

Broadcom has long developed Wi-Fi and Bluetooth in iPhones, while Apple has built radio chips for Apple Watch and Airpods for almost a decade. The N1 now lands in the entire range of iPhone Air and iPhone 17. 

Arun Mathias, Apple’s VP of wireless software technologies and ecosystems, gave one example of what tighter integration can unlock. “One of the things people may not realize is that your Wi-Fi access points actually contribute to your device’s awareness of location, so you don’t need to use GPS, which actually costs more from a power perspective,” Mathias said.

Modems are shifting too. Qualcomm has supplied every iPhone modem since 2020. That started to change in February when Apple rolled out the C1 chip featured in iPhone 16e, after buying Intel’s modem wing for $1 billion in 2019. Qualcomm parts are still used in the iPhone 17 Pro Max, 17 Pro, and 17, while Apple’s C1X ships inside the iPhone Air.

According to Mathias, the C1X is “up to twice as fast” as the C1 and “uses 30% less energy” than the Qualcomm modem in the iPhone 16 Pro. Shares of Qualcomm and Broadcom barely moved after Apple’s announcements, and both will keep licensing agreements with Apple for core technologies.

The A19 Pro arrives as investors press for clarity on Apple’s AI path

Apple has built its own system on a chip since iPhone 4 was launched in 2010, and the A19 Pro rebuilds the architecture to favor AI tasks, adding neural accelerators inside the GPU.

“We are building the best on-device AI capability that anyone else has,” Tim Millet from Apple told CNBC.

“Right now we are focused on making sure that these phones that we’re shipping today, or shipping soon, will be capable of all the important on-device AI workloads that are coming.” Privacy is one driver for on-device processing, he said, but there are practical gains too. “It is efficient for us. It is responsive. We know that we are much more in control over the experience.”

Millet pointed to a “built-in AI” camera feature that sees a new face and flips to a horizontal photo automatically. “It’s leveraging a full complement of almost all the capabilities in the A19 Pro,” he said. 

Apple’s previous-gen A19 is featured in the base iPhone 17, whereas the A19 Pro appears in the iPhone 17 Pro Max, iPhone 17, and iPhone Air. After overheating concerns with the iPhone 15, Apple added a vapor chamber to the Pro models. 

Apple still buys smaller parts from others, Texas Instruments for analog chips and Samsung for memory, but the Apple-designed custom chip could be inside every iPhone model by 2026, with N-variants of the networking chip likely coming to Mac and iPad. 

Some custom chips will be made in the U.S. The A19 Pro is built on TSMC’s leading 3-nanometer node. TSMC aims to reach 3nm production in Arizona by 2028 but is not there yet. 

In August, Trump announced that companies that aren’t producing chips within the U.S. will face a 100% tariff. That day, Cryptopolitan reported that Apple had raised its U.S. spending plan to $600 billion for the next 4 years. According to CEO Tim Cook, a portion of the money will build an “end-to-end silicon supply chain right here in America.” 

For now, Apple is committed to TSMC Arizona. “We are super excited about TSMC’s push into U.S. manufacturing,” Millet said.

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