Nvidia to invest $5 billion in Intel for AI infrastructure and PCs

Leading chipmaker Nvidia has announced its plans to invest $5 billion in tech giant Intel to develop AI infrastructure and PCs, the company said in a release on Thursday, September 18.

Nvidia will purchase Intel common stock for $23.28 per share, a price slightly lower than the $24.90 at which Intel shares closed on Wednesday.

“Nvidia will invest $5 billion in Intel’s common stock at a purchase price of $23.28 per share. The investment is subject to customary closing conditions, including required regulatory approvals,” the chipmaker noted.

This investment will immediately make Nvidia one of Intel's largest shareholders, giving it approximately 4% or more of the company, reported Reuters.

The new development comes after the US government’s decision in August to take a roughly 10% stake in Intel. Japan’s SoftBank Group Corp., which has pledged to invest tens of billions into US chipmaking and cloud infrastructure, made a surprise $2 billion investment too, reported Bloomberg.

Meanwhile, Intel is raising cash by selling assets to investors. Its current operations, hampered by market share losses, cannot bear the heavy spending needed to develop leading-edge semiconductors, it added.

What are Nvidia and Intel's plans?

Companies will look to integrate their architectures using Nvidia's NVLink, bringing together the chipmaker's AI infrastructure and accelerated computing with Intel’s leading CPU technologies and x86 ecosystem.

Intel will develop Nvidia-custom x86 CPUs for data centres, which will be incorporated into Nvidia's AI infrastructure platforms and offered to the market.

For personal computing, Intel will develop x86 system-on-chips (SOCs) that combine Nvidia RTX GPU chiplets. These new x86 RTX SOCs will drive a wide range of PCs that require the integration of top-tier CPUs and GPUs, the company said.

Nvidia CEO Jensen Huang on the latest investment

Speaking on collaboration with Intel, Nvidia founder and CEO Jensen Huang said, “AI is powering a new industrial revolution and reinventing every layer of the computing stack — from silicon to systems to software. At the heart of this reinvention is Nvidia’s CUDA architecture." He further added, “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.”

(With inputs from agencies.)