Intel (INTC) stock surged over 12% on Monday after The Information reported that Google has placed an order for Intel to manufacture more than 3 million Tensor Processing Units (TPUs) in 2028. The deal follows months of testing Intel’s advanced packaging technology and marks a significant win for Intel’s foundry business, which has struggled to compete with TSMC. Morgan Stanley estimates Google will produce over 6 million TPUs across 2027 and 2028, making Intel’s share a substantial contract.
Nvidia (NVDA) is also evaluating Intel’s technology, though no order has been placed. The company is testing whether Intel can manufacture a processor combining four graphics chips into a single unit, tied to Nvidia’s Feynman GPU architecture planned for 2028. Nvidia is additionally running early trials on Intel’s most advanced 18A manufacturing process through multiproject wafer runs. The moves come as TSMC faces capacity constraints from the AI chip boom, pushing major customers to seek alternative manufacturing options.
The Intel news coincided with a broader rebound in semiconductor stocks after a brutal $1.3 trillion selloff on Friday, triggered by Broadcom’s weak outlook and a strong U.S. jobs report that raised fears of prolonged high interest rates. Nvidia CEO Jensen Huang, speaking in Seoul, called the decline a buying opportunity, saying, “We’re at the beginning of it, and whatever happened to the stock market, you should be very happy because now you can buy at a discount.” His comments helped lift sentiment, with Micron Technology and AMD also recovering sharply. Analysts at UBS and IG.com reiterated a constructive view on AI demand, while cautioning that aggressive Fed tightening could still pose risks similar to 2018.
