Intel and Nvidia, the alliance that can rewrite the future

On Thursday, September 4, 2025, US President Donald Trump held his first summit with the CEOs of major US technology companies at the White House. The top executives of Meta, Apple, Microsoft, and Google vied with their host to demonstrate who was the most committed to investing in the US and pleasing the Republican president, who constantly repeats the Make America Great Again (MAGA) mantra. But there were some absences among the 33 diners. Elon Musk, now President Trump's arch-enemy, immediately stood out, but the absence of two people was barely noticeable: Jesse Huang (CEO of Nvidia) and Lip Bu Tan (CEO of Intel). Perhaps they were already busy finalizing the agreement presented last Thursday .

The pact between the two giant American companies bridges the gap between the past and the future of the semiconductor industry, between the aging blue king and the young green emperor. The latter becomes a shareholder in the former with a $5 billion stake, and the two agree to a collaboration to jointly develop multiple generations of PC and data center products. Behind the surprise, there are key elements that give meaning to the deal, both from a geopolitical and corporate perspective .

First, Nvidia's stake in Intel seems difficult to separate from the rescue operation for the blue giant initiated by the US government. Although Jesse Huang has explicitly denied that the White House was involved in designing the operation, it follows the pattern of the proposal made by Craig Barrett. The veteran former CEO of Intel recently called for eight US technology companies to invest $5 billion, reaching the combined $40 billion he estimated was needed to save Intel. He specifically mentioned Nvidia among them. Adding the $5 billion contributed by this company to the $10 billion invested by the White House in Intel's capital—through the exchange of the Chip Act subsidy for company shares—and the $2 billion contributed by Softbank, Intel is almost 50% away from being recapitalized.

The question now is whether and when any of the other major tech companies will enter Intel's capital, acting as a lifeline. And it remains to be seen whether Nvidia's acquisition of Intel shares following the government intervention could win the company any favors from Donald Trump, by easing, for example, export restrictions on its products to China. Jesse Huang's company needs a breath of fresh air in a market that is increasingly uncertain for its interests, especially now that the Chinese government has banned the sale of some of its chips.

Second, the transaction was carefully designed. For two reasons. The positive effect the deal would have on Intel's stock price was already priced in, but it was important that the agreement include conditions that would prevent a significant drop in Nvidia's stock. It was also important that it not interfere with TSMC, the Taiwanese semiconductor manufacturing giant responsible for the production of Nvidia's most advanced AI chips. Thus, the agreement includes no commitments to purchase Intel's 14A and 18A semiconductors, which rival TSMC's two-nanometer chips as components of the coveted cutting-edge GPUs that power AI infrastructure.

Investors understood this, and the Taiwanese company's shares barely suffered a slight initial wobble. Huang showcased the continued good relationship with TSMC by repeatedly praising the company during the joint press conference he held last Thursday with Intel CEO Lip Bu Tan. "I think both Lip Bu and I would say TSMC is a world-class foundry," said the Nvidia founder, adding: "It's impossible to underestimate the magic of TSMC."

The pact does not resolve issues considered vital to US technological sovereignty.

The announcement, therefore, does not include any plans for Nvidia to use Intel's foundry to produce its most advanced AI chips, and Intel's contract manufacturing business loses billions of dollars annually. It continues to struggle to secure external customers, and most analysts believe that for Intel's foundry to survive, it would need to win a major customer like Nvidia, Apple, Qualcomm, or Broadcom .

What the agreement does include is a commitment to cooperation between the two companies to develop AI products based on Intel's x86 architecture, both in personal computing platforms (AI PCs) and in data center equipment, as the demand for artificial intelligence continues to increase. In the former, they will develop products that integrate Intel CPUs with Nvidia GPUs (possibly with TSMC chips), which will result in high-end PCs with artificial intelligence at their core. In the latter, Nvidia will integrate x86 products into its mid-range AI platforms for data centers.

The move, which makes Nvidia one of Intel's largest shareholders, with a 4% stake, could be very relevant in boosting the takeoff of an entire technological segment: AI PCs, because despite the announcements already made by the blue team and the green team about developing this type of device alone, it would have been difficult for both of them to individually achieve an attractive product.

Nvidia's acquisition of a strategic stake in Intel represents a strategic move to diversify the latter's market and further its rescue of the former. This deal not only contributes to Intel's recapitalization without unduly burdening TSMC, but also establishes a crucial collaboration for the development of the next generation of AI-powered PCs, a market with enormous growth potential .

Nvidia is seeking life beyond large-scale AI infrastructure—under pressure from its major customers, which are ramping up production of their own AI chips—and Intel is seeking its resurrection by leveraging the consumer platforms it knows so well. For both purposes, the agreement provides a plus for these two partners, but it doesn't resolve issues considered vital to US technological sovereignty: neither the ultimate survival of Intel, which has been dragging on a severe crisis for years , nor the advance of China in this industry, which threatens Nvidia's dominance .

The agreement, however, leaves one clear victim. AMD sees how this pact strengthens its direct rival Intel. And we'll have to watch the evolution of the agreement, which could represent a potential risk for TSMC. This company currently manufactures the logic chips for Nvidia's flagship AI accelerators, but it remains to be seen whether this business, owned by the world's most valuable company, could one day extend to Intel. In any case, the capital injection into the old blue company gives it breathing space and financial resources to continue cherishing the dream of returning to the leadership of cutting-edge chips.

The Nvidia-Intel alliance is, finally, further proof that Huang's company is not willing to give up its status as king of AI chips and, as it has shown, if it has to take out its checkbook and invest millions of dollars in technology companies where it sees a clear win-win situation , it will do so. Just look at its announcement yesterday: it will invest $100 billion in OpenAI . Nvidia is thus supporting the growth of one of its main clients, which needs to attract investors to finance its expensive infrastructure and, in return, the creator of the popular ChatGPT will continue to buy millions of GPUs from Nvidia. Will this be at the cost of not producing its own AI chips with rivals like Broadcom ?