Nvidia is offering Intel a $5 billion lifeline, just weeks after similar investments from the U.S. government and SoftBank. Nvidia is investing $5 billion in Intel common stock in a partnership that will allow the two companies to “ co-develop multiple generations of custom products for data centers and PCs . ”
How will the two big companies Nvidia and Intel work together?
Nvidia says Intel will help build “x86 system-on-chips (SoCs) that integrate Nvidia RTX GPU chiplets.” These chips will power a “broad range” of PCs, tightly integrating Intel’s CPUs with Nvidia’s GPUs. Intel and Nvidia already work closely together on a number of gaming laptops, but the combined development on a single SoC is a step forward.
This will help Intel and Nvidia better compete with AMD, which has gained ground against Intel with its impressive gaming processors and its range of AI processors for laptops. It also raises further questions about the future of Intel's Arc graphics card business, especially if the company now relies on Nvidia's GPU expertise.
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Nvidia and Intel will also work together to connect their architectures via Nvidia's NVLink communications link system , which is used in data centers to connect GPUs. " Intel will build custom x86 processors for Nvidia, which Nvidia will integrate into its AI infrastructure platforms and bring to market ," Nvidia said.
“This partnership combines Nvidia’s AI and accelerated computing stack with Intel’s processors and vast x86 ecosystem — a fusion of two world-class platforms,” said Nvidia CEO Jensen Huang. “Together, we will expand our ecosystems and lay the foundation for the next era of computing.”
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In short, Nvidia's strategic move to back Intel with a $5 billion investment is a game-changer for the semiconductor industry. The partnership promises closer CPU and GPU coupling at the SoC level, which will boost competitiveness against AMD and potentially redefine Intel's role in graphics cards. At the same time, the deal bolsters Nvidia's ambitions for dominance in AI computing by giving it access to the x86 ecosystem.
This investment by Nvidia in Intel is not just a financial aid but also a strategic partnership. The goal is to accelerate innovation in AI and data centers, creating a single pole of strength in the face of increasing competition.
Nvidia's possible strategic partnerships
News of the investment comes after reports that the chipmaker is working with MediaTek to develop an accelerated processing unit (APU) that combines an Arm-based CPU with Nvidia's Blackwell GPU architecture. Nvidia has been rumored to be working on Arm-based laptop chips for years, and a recent report suggested that gaming laptop could launch sometime this year with Alienware.
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Other investments in Intel
The U.S. government agreed to acquire about 10% of Intel last month, valuing it at $8.9 billion. SoftBank is also investing $2 billion in Intel as the chipmaker has cut costs and laid off thousands of workers in recent months.
Intel's stock price rose 28% (pre-market) after Nvidia's announcement.
