Apple Inc's (AAPL  ) upcoming switch to in-house chips for Bluetooth and Wi-Fi connections from 2025 will likely impact its partner Broadcom Inc (AVGO  ).

The Wi-Fi and Bluetooth chips will enable Apple devices to go online via wireless networks, pair with headphones, and more.

Taiwan Semiconductor Manufacturing Co (TSM  ) manufactured Proxima, which will power Apple's first products in 2025, Bloomberg cites familiar sources.

Apple is developing an end-to-end wireless approach that is integrated with its other components. This will give it an edge in connecting devices to cellular networks and Wi-Fi hubs, paving the way for new device formats.

According to the report, Apple's component will be compatible with the Wi-Fi 6E standard.

Apple will launch the combined Wi-Fi and Bluetooth chip in 2025 under its new home devices, including refreshed TV set-top box and HomePod mini smart speaker versions.

Apple aims to introduce the components to iPhones in 2025 and iPads and Macs by 2026. However, Broadcom will still provide the radio frequency filter for modems.

Reportedly, Apple tapped Broadcom to develop a server chip designed for AI tasks to help meet the computing demands of its new AI features.

Prior reports indicated that the iPhone company had worked on its Apple Chips in Data Center project for several years. This project focused on developing AI inference, an area dominated by Nvidia Corp (NVDA  ). The company also tapped Taiwan Semiconductor for the chip's design and production.

Wedbush's Dan Ives expects Apple to reach a $4 trillion market cap by early 2025 as consumers resonate with the AI revolution.

Apple stock surged 34% year-to-date. Investors can gain exposure to the stock through Vanguard Information Tech ETF (VGT  ) and Fidelity MSCI Information Technology Index ETF (FTEC  ).

Price Action: AAPL stock is down 0.48% at $246.76 at the last check on Friday.