Apple (AAPL  ) is the world's largest company with a market cap of over $2 trillion. Even parts of its business or decisions that seem irrelevant to the company's financials or operating performance can have major impacts on other companies or even countries.

We are seeing this play out at the moment in a variety of ways. Like many other companies, Apple is looking to adjust its supply chains to be more resilient and less dependent on other suppliers. A couple of years ago, it shifted away from using Intel (INTC  ) chips for CPUs and towards its own line of M chips which are internally designed and then manufactured by Taiwan Semiconductor Manufacturing (TSM  ).

Now, the company is looking to do the same for chips that are made by Broadcom (AVGO  ) and Qualcomm (QCOM  ). Qualcomm's modem chips have been an integral part of the iPhone since the iPhone 4. It's expected that this shift could happen as early as 2025.

Additionally, the company is looking to replace Broadcom's Bluetooth, radio frequency identification (RFID), wireless charging, and WiFi chips with its own internally designed chips with a target date of 2026. Both moves would have major implications for Qualcomm and Broadcom and make a dent in its financials that wouldn't be easily replaced.

The genesis of these moves was actually in 2019 when Apple bought Intel's modem division which gave it an influx of engineering talent and patents. The company's longer-term plan is to develop a unified chip that will power all WiFi, cellular connectivity, RFID, and wireless charging.

Production Strategy

Another change in Apple's strategy is to diversify away from China and not become so reliant on that company. Part of this is the rise in tensions between the US and China and the small but increasing probability of a conflict with Taiwan. Another is the country's harsh turn against businesses and its disregard for the economy when it was locking down the country to curb the spread of the coronavirus.

Given that the iPhone remains the crown jewel of the 'Apple ecosystem' and its primary revenue source, the company has already started production in India. Currently, 5% of iPhones are produced in the country. According to reports, Apple is targeting that 50% of iPhones will be produced in India by 2027. Similarly, Airpod and MacBook production will be moving to Vietnam.