Nvidia to invest $5bn in Intel in chip development deal
Trump administration was not involved in the deal, CEO Jensen Huang says
The agreement, announced Thursday, will see the two US companies combine their respective strengths – Nvidia's graphics processing units (GPUs), which dominate AI infrastructure; and Intel's central processing units (CPUs), which remain at the core of most PCs.
The companies described the partnership as a "historic collaboration" but stopped short of announcing a manufacturing tie-up, despite speculation over whether Nvidia might turn to Intel's foundries for production.
The deal follows last month's decision by the US government to acquire a 10% stake in Intel as part of Donald Trump's push to secure the future of American chip manufacturing.
Washington has designated Intel as strategically vital, though its manufacturing unit continues to lose billions of dollars annually while struggling to win external customers.
Jensen Huang, Nvidia's CEO, said the partnership represented "a fusion of two world-class platforms," but stressed that the agreement did not make Nvidia a foundry client.
"I think [Intel chief executive] Lip-Bu [Tan] and I would both say that TSMC is a world-class foundry. You just can't overstate the magic that is TSMC," Huang told reporters, referring to the Taiwanese semiconductor giant, which continues to serve as the key production partner for both firms.
Intel, however, has not abandoned hopes of bringing Nvidia on as a manufacturing customer. Tan said the companies were exploring "multiple ways" to collaborate.
The deal had been in preparation for about a year, before Tan's appointment as Intel chief executive in March 2025.
Under the terms, Intel will design custom CPUs for integration into Nvidia's AI datacentre platforms, while also collaborating on a separate project to develop PC chips.
Nvidia will invest $5 billion in Intel at $23.28 per share.
The collaboration is aimed at a $50 billion market opportunity, according to Huang, who said the arrangement would allow Nvidia to expand into the consumer PC space while giving Intel a stronger foothold in the AI datacentre market.
Huang said that the Trump administration was not involved in the partnership, while noting that commerce secretary Howard Lutnick was “very excited” and supportive of the deal.
The move comes as Intel remains under financial strain. The company reported $12.9 billion in revenue for the second quarter of 2025, ahead of analyst expectations of $11.92 billion, but posted a net loss of $2.9 billion, widening from $1.61 billion a year earlier.
Intel's foundry business alone recorded an operating loss of $3.17 billion on $4.4 billion in revenue, forcing the company to scale back its ambitions.
Tan said in July that Intel would cancel its planned semiconductor plants in Germany and Poland, citing oversupply and insufficient demand. The company also plans to reduce its core workforce to 75,000 by 2025, down from nearly 100,000 in 2024.
"I know the past few months have not been easy," Tan said.
"We are making hard but necessary decisions to streamline the organisation, drive greater efficiency and increase accountability at every level of the company."
Despite the challenging backdrop, Nvidia's investment represents a lifeline for Intel from an unlikely source.
Intel once considered acquiring Nvidia in the mid-2000s for around $20 billion but instead pursued an in-house graphics project, which ultimately failed. That decision left Intel without key expertise in GPU technology, now central to AI computing.
Nvidia's $5 billion bet on Intel follows another investment by Japan-based SoftBank, which disclosed last month that it would purchase $2 billion worth of Intel shares through Arm, the UK-based chip designer it controls.