We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Can Intel's Investment-Driven Strategy Regain Its Competitive Edge?
Read MoreHide Full Article
Key Takeaways
Intel closed a $5B private placement with NVIDIA, selling about 215M shares at $23.28 after FTC approval.
The deal gives NVDA roughly a 4% stake and supports joint AI systems using Intel CPUs with NVIDIA GPUs.
INTC is also backed by U.S. funding and SoftBank, strengthening its balance sheet for fabs and AI R&D.
Intel Corporation ((INTC - Free Report) ) has completed a previously announced $5 billion investment from NVIDIA Corporation ((NVDA - Free Report) ), under which the latter purchased around 214.7 million shares of the former at $23.28 per share. Earlier in December, this transaction received U.S. antitrust approval from the Federal Trade Commission. This purchase gives NVIDIA roughly a 4% equity stake in Intel through a private placement of shares.
The partnership aims to tightly combine Intel’s custom-designed x86 CPUs with NVIDIA’s AI GPUs and NVLink interconnect technology to create faster, more efficient AI systems and next-generation PCs with stronger AI and graphics performance. This could help Intel remain competitive in the AI era.
Intel had also secured $8.9 billion in funds from the U.S. government to support semiconductor manufacturing and packaging projects in Arizona, New Mexico, Ohio and Oregon in order to boost the domestic chip industry. SoftBank has also invested $2 billion, providing funds to support Intel’s restructuring and AI projects.
Intel is constantly making efforts to bring huge investments to strengthen its balance sheet, supporting heavy spending on new factories and R&D, boosting market confidence and enabling deeper technology collaboration with firms like NVIDIA.
How Are Rivals Performing?
Intel faces competition from Qualcomm Incorporated ((QCOM - Free Report) ) and Advanced Micro Devices ((AMD - Free Report) ). Qualcomm recently completed its $2.4 billion acquisition of British semiconductor company Alphawave Semi to strengthen its AI, data center and high-speed connectivity technologies, boosting its competitiveness beyond smartphones. By strengthening its PC chip offerings through programs like Snapdragon X, Qualcomm can expand into new markets such as AI infrastructure, edge computing and personal computers. Qualcomm entered the AI infrastructure space by developing AI accelerators like AI200 & AI250.
AMD is set to launch high-performance AI GPUs, EPYC server CPUs and full AI systems like Helios to compete with NVIDIA and provide faster, more efficient solutions for data centers and enterprises. AMD is partnering with companies like OpenAI and Oracle to expand across gaming, PCs and servers to increase revenues and stay competitive. The company continues to improve its ROCm open software stack and open hardware standards.
INTC’s Price Performance, Valuation & Estimates
Shares of Intel have surged 85% over the past year compared with the industry’s growth of 34.1%.
Image Source: Zacks Investment Research
Going by the price/book ratio, the company's shares currently trade at 1.5 book value, lower than 32.5 of the industry average.
Image Source: Zacks Investment Research
INTC’s earnings estimates for 2025 have increased 6.3% to 34 cents per share, while those for 2026 have declined 6.5% to 58 cents over the past 60 days.
Image: Bigstock
Can Intel's Investment-Driven Strategy Regain Its Competitive Edge?
Key Takeaways
Intel Corporation ((INTC - Free Report) ) has completed a previously announced $5 billion investment from NVIDIA Corporation ((NVDA - Free Report) ), under which the latter purchased around 214.7 million shares of the former at $23.28 per share. Earlier in December, this transaction received U.S. antitrust approval from the Federal Trade Commission. This purchase gives NVIDIA roughly a 4% equity stake in Intel through a private placement of shares.
The partnership aims to tightly combine Intel’s custom-designed x86 CPUs with NVIDIA’s AI GPUs and NVLink interconnect technology to create faster, more efficient AI systems and next-generation PCs with stronger AI and graphics performance. This could help Intel remain competitive in the AI era.
Intel had also secured $8.9 billion in funds from the U.S. government to support semiconductor manufacturing and packaging projects in Arizona, New Mexico, Ohio and Oregon in order to boost the domestic chip industry. SoftBank has also invested $2 billion, providing funds to support Intel’s restructuring and AI projects.
Intel is constantly making efforts to bring huge investments to strengthen its balance sheet, supporting heavy spending on new factories and R&D, boosting market confidence and enabling deeper technology collaboration with firms like NVIDIA.
How Are Rivals Performing?
Intel faces competition from Qualcomm Incorporated ((QCOM - Free Report) ) and Advanced Micro Devices ((AMD - Free Report) ). Qualcomm recently completed its $2.4 billion acquisition of British semiconductor company Alphawave Semi to strengthen its AI, data center and high-speed connectivity technologies, boosting its competitiveness beyond smartphones. By strengthening its PC chip offerings through programs like Snapdragon X, Qualcomm can expand into new markets such as AI infrastructure, edge computing and personal computers. Qualcomm entered the AI infrastructure space by developing AI accelerators like AI200 & AI250.
AMD is set to launch high-performance AI GPUs, EPYC server CPUs and full AI systems like Helios to compete with NVIDIA and provide faster, more efficient solutions for data centers and enterprises. AMD is partnering with companies like OpenAI and Oracle to expand across gaming, PCs and servers to increase revenues and stay competitive. The company continues to improve its ROCm open software stack and open hardware standards.
INTC’s Price Performance, Valuation & Estimates
Shares of Intel have surged 85% over the past year compared with the industry’s growth of 34.1%.
Image Source: Zacks Investment Research
Going by the price/book ratio, the company's shares currently trade at 1.5 book value, lower than 32.5 of the industry average.
Image Source: Zacks Investment Research
INTC’s earnings estimates for 2025 have increased 6.3% to 34 cents per share, while those for 2026 have declined 6.5% to 58 cents over the past 60 days.
Image Source: Zacks Investment Research
Intel stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.