Bloomberg published a report at the end of 2021 that Apple (NASDAQ: AAPL) intended to hire people right in Broadcom's (NASDAQ: AVGO) and Skyworks Solutions' (NASDAQ: SWKS) backyard of Irvine, California, to design wireless communication chips. Nevertheless, investors were still shocked when a recent report suggested Apple intends to replace Broadcom's Wi-Fi and Bluetooth chips as soon as 2025.

While there are many benefits that Apple could gain by designing proprietary components and transitioning away from third-party providers like Broadcom, the strategy also comes fraught with risk.

Let's look at the risks and rewards of the company's strategy to eliminate its component suppliers.

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Source Fool.com