Nvidia is on top of the world right now, riding waves of investment in “AI” and becoming one of the most powerful and most profitable companies on the planet. Intel? Not so much. The company has been struggling in sales and performance for more than a year.
So color me shocked when Nvidia and Intel announced a joint venture this morning that could be huge for both.
Nvidia is investing $5 billion into Intel stock—a comparatively small slice for both companies—and approximately half of what the United States government invested in it after president Trump and other politicians demanded action on Intel’s CEO. But the bigger news coming from the press release is that Nvidia and Intel will partner on new chips for both data centers and consumers. The so-called “x86 RTX” chips will integrate Nvidia-designed graphics and AI chiplets into Intel CPUs.
“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,” said Nvidia CEO Jensen Huang.
Nvidia has been unassailable on the discrete graphics card front for years, now commanding over 90 percent of sales for desktop add-in boards in an effective monopoly, and dominating both sales and discussion for anything related to graphics, gaming, and “AI” industrial processing. Its longtime rival AMD has struggled to hold onto what market share it had, slipping even as it reportedly sells every GPU it can make. Things are better for AMD on the CPU side, where it’s gaining ground against Intel on the back of strong sales for laptop and desktop chips, especially its well-regarded X3D gaming series.
Intel has been trying to enter the discrete graphics market for the last three years. But despite impressive gains in performance right out of the gate, the Arc series of desktop graphics cards has made barely a blip, falling to nearly zero percent market share. Exactly what will happen to Arc if Intel starts to co-brand Nvidia integrated graphics isn’t quite known.
Nvidia’s meteoric rise to the top of both the chip market and the technology world has recently hit a highly visible snag, as reports indicate that the Chinese government is blocking purchases of its chips. The incredibly lucrative market was already showing some speed bumps as embargoes limit the performance of exported chips and China invests in domestic production to leverage its incredible energy and industrial infrastructure to compete with rivals like the United States and Taiwan.
Intel and Nvidia will hold a joint press conference this afternoon, broadcast live on the web.