NEW YORK CITY, New York: Apple and Intel have reached a preliminary agreement under which Intel would manufacture some of the chips used in Apple devices, the Wall Street Journal reported on Friday, citing people familiar with the matter.

The report said the two companies have been engaged in intensive discussions for more than a year and finalised a formal agreement in recent months.

Details of the arrangement remain unclear, including which Apple products would use chips manufactured by Intel, according to the report.

The potential partnership would mark a significant development for Intel as the company works to expand its contract chip manufacturing business and compete more aggressively in the global semiconductor industry.

Intel shares surged following the report and were last trading about 14% higher, while Apple shares rose roughly 2%.

Neither company immediately responded to requests for comment.