Nvidia Bets Big on Intel as Chip War Heats Up

Intel's deal with Nvidia has sparked a new chip war, with Intel shares jumping 23% on September 18, 2025, after Nvidia announced a $5 billion equity investment. This move has made Nvidia one of Intel's largest shareholders, holding roughly a 4% stake.

The partnership between the two companies will focus on jointly developing PC and data-center chips, including custom x86 SoCs that integrate Nvidia RTX graphics chiplets. However, this agreement does not currently make Intel a contract manufacturer for Nvidia's flagship processors, which are still made by TSMC.

TSMC remains the central force in global advanced chip production, with Intel aiming to secure a major foundry customer in 2026 as part of its turnaround strategy. The company has already begun initial risk production on its 18A advanced manufacturing process but needs to show it can deliver on schedule and at scale.

Analyst Luke Lin notes that the partnership may actually increase pressure on AMD, Nvidia's competitor, rather than TSMC. He also suggests that even Intel's failure could leave TSMC stronger, as it would maintain its market share and reduce U.S. pressure on the company.