Nvidia has agreed to purchase a $5 billion stake in Intel, cementing a wide-ranging partnership to jointly develop next-generation data center and consumer PC chips.
Under the deal, Nvidia will acquire Intel shares at $23.28 each, giving it about a 4% ownership stake, according to Reuters. The announcement sent Intel stock soaring as much as 30% in early trading Thursday.
The collaboration centers on combining Intel’s CPU expertise with Nvidia’s GPU dominance using NVLink, Nvidia’s high-speed interface that enables faster data transfer between chips than PCI Express. This integration is critical for AI workloads, which demand massive processing power across multiple GPUs.
For the data center market, Intel will manufacture a new line of customized x86 CPUs designed specifically for Nvidia’s AI infrastructure platforms.
On the consumer PC side, Intel will produce x86 system-on-chips (SoCs) that incorporate Nvidia RTX GPU chiplets. Dubbed “x86 RTX SoCs”, these chips are aimed at a wide range of PCs and could sharpen Intel’s competitive edge against AMD.
The deal comes at a pivotal moment for both companies. Nvidia has surged to become the world’s most valuable semiconductor company, riding record demand for its AI chips. Intel, meanwhile, has struggled to regain footing in the AI race, weathering CEO changes, mass layoffs, and scrapped projects to restore profitability.
Related: Huawei Debuts AI Infrastructure as China Bans Nvidia Chips
Intel CEO Lip-Bu Tan called the partnership a turning point:
“Intel’s leading data center and client computing platforms, combined with our process technology, manufacturing and advanced packaging capabilities, will complement NVIDIA’s AI and accelerated computing leadership to enable new breakthroughs for the industry.”
By teaming up, Nvidia and Intel are hoping to not only boost their positions in AI but also reclaim market share from rivals, especially AMD, which has been steadily gaining ground in both consumer and enterprise markets.
