Nvidia Bets Big on Intel With $5B Investment
Zeng Yu / VCG via Getty Images
Intel shares are soaring Thursday after Nvidia announced a $5 billion investment in the struggling chipmaker.
-
Nvidia is investing $5 billion in Intel and will co-develop chips for PCs and data centers, the companies announced Thursday.
-
Nvidia said it will buy Intel common stock at $23.28 a share, around 7% below where they closed yesterday.
-
Intel shares soared in premarket trading Thursday following the news. Nvidia shares also climbed.
Nvidia (NVDA) is investing $5 billion in Intel and will jointly develop chips and data centers, the companies announced Thursday.
Nvidia, the chip designer at the heart of the AI boom, said it will buy Intel common stock at $23.28 a share—around 7% below where they closed yesterday. The news of the tie-up between the two American chipmakers sent shares of government-backed Intel soaring 28% in premarket trading, while Nvidia shares climbed 3%.
Intel will build data centers that Nvidia will ” integrate into its AI infrastructure platforms and offer to the market,” and also make chips that will integrate “Nvidia RTX GPU chiplets,” the companies said.
Nvidia CEO Jensen Huang called it a “historic collaboration” that fuses two “world-class platforms,” adding “together, we will expand our ecosystems and lay the foundation for the next era of computing.”
Intel CEO Lip-Bu Tan, meanwhile, said the company’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.”
Once a leading chipmaker, Intel has fallen behind rivals like chip manufacturer TSMC (TSM) and struggled to keep up with technological advancements in the space. The Trump administration is pushing to make the company a national champion in the production of AI chips, however, and last month said it would take a 10% stake in the company.
Read the original article on Investopedia