On 18/9, American chipmaker Nvidia announced a $5 billion investment in Intel as part of a partnership to develop data centers and personal computer (PC) chips. Nvidia will purchase Intel shares at $23.28 per unit, close to Intel's closing price on 17/9. This agreement makes Nvidia one of Intel's largest shareholders, with a 4% stake.
"This landmark collaboration will unite Nvidia's AI and computing platform with Intel's central processing unit (CPU) and massive x86 chip ecosystem. It's a fusion of two world-leading platforms. Together, we will expand the ecosystem and lay the foundation for the next era of computing," said Nvidia CEO Jensen Huang.
Intel's stock surged 25% at the opening of trading on 18/9, while Nvidia's stock rose nearly 3%.
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Outside Intel headquarters in California. Photo: Intel |
Outside Intel headquarters in California. Photo: Intel
According to the announcement, Intel will manufacture x86 CPUs for Nvidia's AI infrastructure platforms. For the PC sector, Intel will produce x86 system-on-a-chip (SoC) processors combined with Nvidia's RTX graphics processors to power personal computers.
"The key question is whether this partnership is purely political or the start of greater future collaboration that could significantly benefit Intel," commented Chris Caso, an analyst at Wolfe Research.
The biggest question is whether Nvidia will manufacture chips at Intel's fabrication plants. Intel has invested heavily in developing its foundry business—manufacturing chips for other companies. However, it has yet to secure major clients.
Following the US government and Japanese telecommunications giant SoftBank, Nvidia is the next entity to help turn Intel's fortunes around. Intel was once the largest chipmaker in the US, but in recent years has been overtaken by rivals like Nvidia, Qualcomm, Broadcom, Texas Instruments, and AMD.
Earlier this year, Intel's stock hit its lowest point in over a decade. It rebounded after receiving support from the administration of US President Donald Trump. Last month, the US government acquired a 10% stake in the company for nearly $9 billion. This stake is now worth almost $14 billion. SoftBank also injected $2 billion into Intel in August.
Ha Thu (according to Reuters, CNBC)
