Nvidia to Invest Five Billion Dollars in Intel Amid AI Collaboration and Trump Administration Stake

Nvidia, the world’s leading chipmaker, has revealed plans to invest $5bn in Intel and enter into a significant collaboration with the embattled semiconductor firm. This move comes just a month after the Trump administration confirmed it had acquired a ten percent stake in Intel, an extraordinary intervention that sent markets into a frenzy. Nvidia’s announcement signals a deeper partnership between the two technology giants, focusing on custom datacentres that underpin artificial intelligence infrastructure, as well as personal computing innovations.

The investment sees Nvidia agreeing to purchase Intel common stock at $23.28 per share, pending regulatory clearance. Jensen Huang, Nvidia’s chief executive, described the collaboration as a fusion of “two world-class platforms”, promising a tight integration of Nvidia’s artificial intelligence and accelerated computing with Intel’s established CPU and x86 ecosystem. The partnership is expected to see Intel manufacture custom chips for Nvidia’s AI infrastructure platforms, while also building processors that integrate Nvidia’s technology for PC products.

Intel’s shares soared by nearly 23 percent in late trading, the company’s largest single-day percentage gain since 1987, while Nvidia’s shares rose more than three percent, further boosting its remarkable $4tn market valuation. For Intel, this arrangement delivers a much-needed reprieve. The Silicon Valley stalwart, once dominant in the PC era, has faltered following the rise of mobile computing and the rapid advances in AI. Last year, Intel reported losses nearing $19bn and an additional $3.7bn in the first six months of the current year, signalling intentions to reduce its workforce by a quarter by year’s end.

As Nvidia’s specialised GPUs continue to drive the artificial intelligence revolution, Intel faces increasing pressure to regain its footing. The collaboration may accelerate its efforts to enter the AI race, with analysts forecasting a total AI infrastructure investment between $3tn and $4tn by the decade’s end. Softbank, the Japanese technology investment firm, recently acquired a two percent stake in Intel by investing $2bn, expanding its US presence after news broke of the government’s involvement.

The Trump administration has aggressively pushed to strengthen the US semiconductor industry, threatening steep tariffs on imported chips and brokering export agreements with Nvidia and AMD. These deals allow certain AI chips with reduced processing power to be sold to China, with the US government taking a 15 percent share of any revenues. Nvidia’s backing provides further validation of the firm’s pre-eminence in AI, while offering Intel a fresh opportunity to reclaim its influence amid unprecedented public and private sector involvement in the sector’s future.