According to The Information, Google placed orders for its Tensor Processing Units from Intel after TSMC struggled to meet demand for manufacturing capacity.
- The report stated that Google placed the order for Intel to manufacture its TPUs after months of testing the company’s chip packaging technology.
- Intel will begin manufacturing the chips for Google in 2028.
- Nvidia is also reportedly evaluating Intel's manufacturing technology to assess whether the chipmaker can produce the upcoming processor for its next-generation Graphics Processing Unit architecture.
Intel Corp. (INTC) shares soared in Monday’s opening trade after a report stated that it secured an order for three million chips from Alphabet Inc.’s (GOOG, GOOGL) Google.
According to a report by The Information, Google placed the orders for its specialized AI chips known as Tensor Processing Units (TPUs) after Taiwan Semiconductor Manufacturing Co. (TSM) struggled to keep up with demand for its manufacturing capacity.
Intel shares were up more than 10% in Monday’s opening trade. INTC was the top trending ticker on Stocktwits at the time of writing.
GOOGL Placed Orders After Months Of Testing, Says Report
The report stated that Google placed the order for Intel to manufacture its TPUs after months of testing the company’s chip packaging technology. Intel will begin manufacturing the chips for Google in 2028.
Nvidia is also reportedly evaluating Intel's manufacturing technology to assess whether the chipmaker can produce the upcoming processor for its next-generation Graphics Processing Unit (GPU) architecture. The architecture, known as the Feynman series, combines four GPUs into a single package.
The Google-Intel deal comes after Google struck multiple partnerships this year for its TPU chips, starting with Meta Platforms Inc. (META) in February and then Anthropic in April.
Another Boost To INTC’s Foundry Unit
The Google deal and Nvidia evaluation provide another boost to Intel’s foundry unit, which had underperformed for years, leading to the ouster of former CEO Pat Gelsinger in late 2024.
Intel and Apple Inc. (AAPL) reportedly reached a preliminary agreement in May this year under which Intel will manufacture some of the chips powering Apple devices.
Unlike Nvidia and Advanced Micro Devices Inc. (AMD), which primarily design chips and rely on external manufacturers, Intel both designs and produces its own semiconductors. Nvidia, AMD, and most other fabless chipmakers outsource production to TSMC.
This also includes Apple, which ships around 200 million devices across its ecosystem of iPhones, iPads, Macs, and more.
Intel also joined Tesla Inc.’s (TSLA) Terafab project in April this year to make processors to power the EV giant’s robotics and data center ambitions.
How Did Retail Investors React To INTC Stock?
Retail sentiment on Stocktwits around Intel trended in the ‘neutral’ territory at the time of writing.
INTC stock is up 193% year-to-date, while GOOGL stock is up 15%. The S&P 500 ETF (SPY) is up 24% over the past 12 months, while the Invesco QQQ Trust ETF (QQQ) is up 35%.
The Vanguard S&P 500 ETF (VOO) is up 24% during this period.
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