In a shocking industry breakthrough, long-time competitors NVIDIA and Intel have announced a strategic partnership to jointly develop multiple generations of new x86 processors for gaming PCs and data centers. As part of the agreement, NVIDIA will also invest $5 billion to acquire approximately 5% of Intel's shares.
Strong Collaboration: x86 Chips Integrated with NVLink Technology
This collaboration aims to combine Intel's deep expertise in x86 processors with NVIDIA's leadership in artificial intelligence acceleration technology. The two companies will integrate their CPU and GPU expertise into a single chip through NVIDIA's high-speed NVLink interconnect technology, jointly exploring the ultra-large-scale, enterprise, and consumer markets.
NVIDIA stated that this collaboration is currently in the early stage, and specific release schedules and technical details have not been announced. However, both companies emphasized that this is a multi-year roadmap plan aimed at complementing rather than replacing NVIDIA's existing Grace and Vera CPU products based on the Arm architecture.
PC Market: Launching 'Intel x86RTX SOC'
A key initiative of this collaboration is the development of the 'Intel x86RTX SOC', a system-on-chip (SoC) that integrates Intel's x86 CPU with NVIDIA's RTX GPU within the same package. Intel will be responsible for the production and sales of these processors.
These chipsets will be connected via NVLink technology, with bandwidth promising to be 14 times that of traditional PCIe while having lower latency. The target market for this SoC is thin-and-light gaming laptops and small PCs, directly competing with AMD's APU products. Although NVIDIA will continue to provide its own GPU drivers, Intel's integrated Xe graphics will remain the standard configuration for its mass-market products.
Data Center: Customized x86 CPUs Support IDM2.0 Strategy
In addition to the PC market, Intel will customize and build x86 CPUs for NVIDIA's data center customers. These custom chips will use NVLink technology to enable faster CPU-GPU interconnection and will be sold by NVIDIA under its own brand to enterprise and hyperscale users.
This move aligns closely with Intel's IDM2.0 strategy, which encourages customized semiconductor development. Intel has established a new department for this purpose, and NVIDIA has already tested prototype chips on Intel's advanced 18A node.
NVIDIA's $5 Billion Investment Provides Critical Support to Intel
The core of this collaboration is NVIDIA's investment of $5 billion in Intel at a price of $23.28 per share, acquiring approximately 5% of its shares. This deal still requires regulatory approval.
This investment is crucial for Intel, which is facing significant capital expenditures required to compete with TSMC and has negative cash flow. Previously, Intel had received $9 billion in funding from the U.S. government and a $2 billion stock purchase from SoftBank, showing confidence from all sides in its ability to turn things around.
