Nvidia is investing $5bn (£4bn) in Intel, a rare show of support for its struggling rival just weeks after the Trump administration bought a 10% stake in the US chipmaker.
The agreement, announced on Thursday, gives Intel a badly needed boost as it tries to catch up in the artificial intelligence (AI) race, while cementing Nvidia’s position at the heart of the global chip industry.
Lifeline for a Silicon Valley Veteran
Intel’s shares jumped 27% in New York after the deal was revealed, while Nvidia rose more than 3%, adding to its $4tn market value. Nvidia will buy the stock at $23.28 a share, subject to regulatory approval.
For Intel, once the undisputed leader of the PC era, the tie-up offers a lifeline. The company has lost ground over the past decade, first by missing the shift to smartphones and then by falling behind as AI transformed the sector. It reported losses of nearly $19bn last year and another $3.7bn in the first half of 2025. A quarter of its workforce is set to be cut by year-end.
Joint Work on AI and PCs
Under the plan, Intel will make custom chips for Nvidia’s AI data centres and develop PC processors that incorporate Nvidia technology.
“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 Jensen Huang said.
Both companies said their goal was to “seamlessly connect” their technologies, with Nvidia’s graphics processors powering AI systems and Intel’s CPUs providing the backbone.
Political and Strategic Backing
The move comes just a month after Donald Trump’s administration confirmed it had taken a 10% stake in Intel, a rare intervention by Washington in corporate America. The White House has described Intel as strategically vital to US national security and has threatened 100% tariffs on imported chips in an attempt to push manufacturing back onshore.
Trump has also struck deals with Nvidia and rival AMD, allowing limited exports of lower-powered AI chips to China in exchange for a 15% government cut of sales.
Japan’s SoftBank added its backing in August, investing $2bn for a 2% stake in Intel. Together, the three injections underline Intel’s central role in the US semiconductor strategy.
Nvidia’s Dominance
Nvidia has soared to become the world’s most valuable company thanks to its dominance of graphics processing units (GPUs), the chips most in demand for training AI systems.
Dan Ives, tech analyst at Wedbush, said the partnership was further proof of Nvidia’s grip on the market.
“With AI infrastructure spending expected to reach between $3tn and $4tn by 2030, the chip landscape remains Nvidia’s world, with everybody else paying rent,” he said.
What It Means for Intel
For Intel, the deal is a chance to claw back relevance in the AI age after years of missteps. For Nvidia, it strengthens its role as the industry’s linchpin while aligning with Washington’s push to safeguard US chipmaking.
The partnership marks a rare moment of collaboration between two fierce rivals and highlights how government policy, corporate strategy and the global AI boom are becoming increasingly intertwined.
