Nvidia to invest billions in ailing chipmaker Intel in surprise move
Intel has some 5,000 workers based here in Ireland, concentrated primarily in the company’s campus in Leixlip, Kildare. File picture: Colin Keegan, Collins Dublin
Nvidia is to invest $5bn (€4.3bn) in Intel and said the two will co-develop chips for PCs and data centres, a surprise move to help prop up an ailing archrival.
Nvidia will buy Intel common stock at $23.28 per share, the two companies said on Thursday. Intel will use Nvidia’s graphics technology in upcoming PC chips and also provide its processors for data centre products built around Nvidia hardware.
The two companies didn’t offer a timeline for when the first parts will go on sale and said the announcement doesn’t affect their individual future plans.
Intel has some 5,000 workers based here in Ireland, concentrated primarily in the company’s campus in Leixlip, Kildare. Some 300 employees are based at the company’s research and development base in Shannon; however, the company announced last year that it would close this facility by the end of 2025 as part of its savings plan.
The new Nvidia funds for Intel come after the US government agreed to take a roughly 10% stake in August and President Donald Trump took on the role of pitchman. Japan’s SoftBank Group, which has committed to invest tens of billions into US chipmaking and cloud infrastructure, made a surprise $2bn (€1.7bn) investment last month and Intel’s also raising cash by selling assets to investors.
Its current operations, hit by market share losses, cannot shoulder the burden of intensive spending associated with trying to build leading-edge semiconductors.
The tie-up between the two Santa Clara, California-based rivals underlines how the balance of power in the computer industry has shifted. Intel is getting a financial shot in the arm and access to market-leading technology from a company that it once relegated to a niche role on the industry’s fringes.
“This historic collaboration tightly couples Nvidia’s AI and accelerated computing stack with Intel’s CPUs and the vast x86 ecosystem — a fusion of two world-class platforms,” Nvidia Chief Executive Officer Jensen Huang said in a statement. “Together, we will expand our ecosystems and lay the foundation for the next era of computing.”
Intel will offer PC chips that combine general purpose processing with powerful graphics components from Nvidia, better helping it compete with Advanced Micro Devices, which has been seizing market share in desktops and laptops. AMD is Nvidia’s closest competitor in graphics chips. The AI leader continues to evaluate whether to outsource production of its chips to Intel, but has no current plans to do so.
“We appreciate the confidence Jensen and the Nvidia team have placed in us with their investment and look forward to the work ahead as we innovate for customers,” Intel CEO Lip-Bu Tan said in the statement. “Intel’s x86 architecture has been foundational to modern computing for decades – and we are innovating across our portfolio to enable the workloads of the future.”
Nvidia’s power to determine the future of the industry, and now Intel’s pragmatic attempt to work alongside it, is based on Nvidia’s utter dominance of AI computing. The company saw the need for new types of chips and software ahead of the debut of services such as ChatGPT from OpenAI and had them ready before any of its rivals.
When the world’s biggest companies rushed to build data centers to make sure they could compete in the new era of computing, they turned to Nvidia’s chips. As recently as 2022, Intel had more than twice as much revenue as Nvidia.
The company that gave Silicon Valley its name dominated computing from laptops to data centres with its microprocessors. But it was slow to field the type of accelerator chip that Nvidia offers and has failed to garner meaningful market share in that area.
