Intel Shares Post 30 Percent Surge on Historic Nvidia Investment
(MENAFN) Shares of US chip giant Intel surged nearly 30% in pre-market trading on Thursday, following the announcement of a groundbreaking $5 billion investment by Nvidia. The deal, designed to boost both companies’ presence in the PC and data center markets, comes after significant US government backing for Intel last month.
According to a Nvidia press release, the investment will be made at a price of $23.28 per share.
At around 11:30 GMT, Intel’s shares were trading near $32 in pre-market hours, reflecting the positive market reaction.
As part of the agreement, Intel will design and manufacture custom central processing units (CPUs) for both client devices and data centers, incorporating Nvidia's NVLink system for enhanced performance.
In a statement, Nvidia outlined the focus of the partnership: "The companies will focus on seamlessly connecting NVIDIA and Intel architectures using NVIDIA NVLink — integrating the strengths of NVIDIA’s AI and accelerated computing with Intel’s leading CPU technologies and x86 ecosystem to deliver cutting-edge solutions for customers."
For data centers, Intel will build custom x86 CPUs, which Nvidia will incorporate into its AI infrastructure platforms for distribution in the market.
Nvidia CEO Jensen Huang called the collaboration “historic,” stating, “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. Together, we will expand our ecosystems and lay the foundation for the next era of computing.”
In pre-market trading, Nvidia's shares also saw a 3.4% rise, as the company continues negotiations with China over the sale of less-advanced processors.
Intel, which saw its stock reach a decade-low earlier this year, has been on a recovery trajectory, particularly after a strategic investment from the US government in August, where Washington acquired a 10% stake in the chipmaker. Since then, Intel's stock has gained 11% from the beginning of July.
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