NVIDIA acquires $5B stake in Intel, plans joint chip development
**NVIDIA Acquires $5 Billion Stake in Intel, Plans Joint Chip Development**
*By Mudit Dube | Sep 18, 2025, 05:09 PM*
NVIDIA has announced a significant $5 billion investment in Intel, marking a pivotal move that could reshape the semiconductor industry landscape. As part of this deal, NVIDIA will acquire common stock of Intel at $23.28 per share—slightly below Wednesday’s closing price of $24.90 but above the recent government purchase price of $20.47.
### NVIDIA Becomes One of Intel’s Largest Shareholders
With this investment, NVIDIA is set to become one of Intel’s largest shareholders, holding a stake of 4% or more after the issuance of new shares. This partnership comes as a much-needed boost for Intel, which has faced challenges in turning around its business in recent years.
The deal also holds strategic implications for Taiwan Semiconductor Manufacturing Company (TSMC), which currently manufactures NVIDIA’s flagship processors, potentially altering existing industry dynamics.
### What’s Excluded from the Deal?
It is important to note that Intel’s contract manufacturing business, commonly known as its foundry operations, is not part of this agreement. Industry analysts suggest that for Intel’s foundry business to thrive, it requires a major customer like NVIDIA, Apple, Qualcomm, or Broadcom.
This deal, however, strengthens Intel’s financial position, adding to recent capital infusions including a $2 billion investment from SoftBank and $5.7 billion from the U.S. government.
### Collaboration Focus: Gaining an Edge in AI Markets
Under the new partnership, Intel will design custom data center central processors, which NVIDIA will integrate with its AI chips and GPUs. NVIDIA’s proprietary technology aims to facilitate faster communication between Intel and NVIDIA chips, potentially giving Intel a competitive advantage in the AI market where efficient multi-chip connectivity is crucial for handling large-scale data processing.
### Impact on the Market: A Threat to AMD and Broadcom
Currently, NVIDIA’s advanced AI servers with high-speed chip interconnects are only available using its own chips. This collaboration opens the door for Intel to compete directly in this space and monetize NVIDIA’s server platforms.
The combined Intel-NVIDIA chip solutions could pose a significant challenge to competitors like AMD and Broadcom, who are also developing AI servers and chip-to-chip connection technologies.
### Strategic Advantage in Consumer Markets
For the consumer segment, NVIDIA will supply Intel with custom graphics chips to be packaged alongside Intel’s PC central processors. This integration could help Intel gain an edge over rivals such as AMD.
Despite losing some ground in data centers and personal computers to Arm Ltd.-based technologies, Intel continues to hold a majority share in the x86 computing architecture market.
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This landmark investment and strategic partnership between NVIDIA and Intel signal a potentially transformative era for both companies and the broader semiconductor ecosystem.
https://www.newsbytesapp.com/news/business/nvidia-invests-5b-in-intel-forms-ai-chip-partnership/story
