Google to Rely on Intel for 3 Million AI Chips
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Shares of Inteljumped on Monday following a report saying Alphabet'sGoogle will rely on it for more than three million specialized AI chips in 2028.BACKUP CHIP MAKER:According to aby The Information's Qianer Liu, TSMC'scapacity struggles are turning into a boon for Intel. As the Taiwanese chip making giant struggles to meet overwhelming demand for its chip manufacturing capacity, several major AI chip design companies, including Google and Nvidia, are quietly turning to Intel as a backup manufacturer for their most advanced processors, according to four people with direct knowledge of the discussions.According to the publication, Google has placed an order with Intel to manufacture more than three million tensor processing units in 2028. Google decided to tap Intel to make some of its tensor processing units — TPUs for short — after months of testing the chipmaker's technology. Nvidia has not yet placed an order with Intel as it is testing whether Intel technology can be used to make a forthcoming processor that combines four graphics chips into a single unit.OF NOTE:Last week, both Mizuho and Wells Fargo raised their price targets on Intel to $128 and $110, respectively, while keeping Neutral-equivalent ratings on the stock.Mizuho upped price targets in the semiconductor group, saying agentic AI demand is strong across the CPU ecosystem. Suppliers remain supply-constrained into 2027, which indicates upside in servers, the firm told investors in a research note. Mizuho sees agentic AI driving demand higher, but says memory and CPU supply could potentially limit upside in in the second half of 2026.Meanwhile, Wells Fargo argued that memory constraints appear very poised to continue through 2027, and to be determined in 2028. Economies-of-scale are a significant competitive advantage and lever, the firm added.PRICE ACTION:In morning trading, shares of Intel have gained over 13% at $112.25.
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Analyst Views on INTC
Wall Street analysts forecast INTC stock price to fall
29 Analyst Rating
5 Buy
19 Hold
5 Sell
Hold
Current: 107.920
Low
20.00
Averages
39.30
High
52.00
Current: 107.920
Low
20.00
Averages
39.30
High
52.00
About INTC
Intel Corporation is a global designer and manufacturer of semiconductor products. The Company's segments include Intel Products, Intel Foundry, and All Other. Its Intel Products comprise Client Computing Group (CCG) and Data Center and AI (DCAI). CCG delivers platforms and processors that power PCs and edge devices, enabling enhanced performance, connectivity and user experience for consumer and commercial markets with capabilities that also support retail, industrial robotics and AI ecosystems at the edge. DCAI delivers workload-optimized solutions based upon its x86 architecture for data centers, including CPUs, AI accelerators, NICs, IPUs and custom ASICs, enabling performance and scalability for cloud, enterprise, telecommunication and HPC environments. The Intel Foundry segment comprises technology development, manufacturing and foundry services, developing new semiconductor process technologies and advanced packaging technologies. All Other segments include Mobileye and Other.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Intel Shares Surge 168% Amid Earnings Growth
- Strong Financial Performance: Intel's Q1 fiscal 2026 revenue rose 7% year-over-year to $13.6 billion, with non-GAAP EPS at $0.29 and net income soaring 156% to nearly $1.5 billion, indicating significant improvements in financial and operational metrics.
- Rising Data Center Demand: Demand for Intel's Xeon server CPUs is outpacing supply, particularly in AI data centers, with management noting that the CPU-to-GPU ratio may shift from 7:1 to 3:1 as workloads transition to inference, enhancing Intel's potential in AI infrastructure growth.
- Strengthened Partnerships: In April 2026, Google expanded its multiyear partnership with Intel to utilize Xeon CPUs for AI inference and cloud workloads, providing Intel with clearer visibility into future data center demand and stable chip requirements over the next three to five years.
- Manufacturing Technology Challenges: Despite generating $5.4 billion in revenue from its Foundry segment in Q1, Intel faced an operating loss of approximately $2.4 billion and a GAAP loss of $0.73 per share, with management anticipating a decline in PC demand in the second half of 2026, indicating that the company's turnaround relies heavily on data center demand and successful execution of its 18A technology.
See More
Intel Partners with Major Tech Giants
- Partnership Expansion: Intel is forming partnerships with several leading tech companies globally, aiming to enhance product competitiveness through technology integration, although specific details of these collaborations remain undisclosed, this move could strengthen its market position.
- Market Response Stable: As of the afternoon of June 8, 2026, Intel's stock price stood at $0.54, indicating a cautiously optimistic market reaction to its partnership strategy, with no significant fluctuations observed, reflecting investor expectations for future growth.
- Integration Potential: Collaborations with major tech firms may provide Intel with new opportunities for technology integration, enhancing its innovation capabilities in the semiconductor industry, thereby driving long-term growth.
- Strategic Implications: By partnering with industry leaders, Intel not only expands its product offerings but also maintains a competitive edge in a fiercely contested market, thereby increasing its influence within the global tech ecosystem.
See More
Intel's Stock Fluctuations and New Order Outlook
- Stock Performance Volatility: Intel's shares have surged 427% over the past year, yet they have declined over 16% since hitting a 52-week high on May 11, indicating investor concerns about its future prospects amid a broader semiconductor market downturn.
- Major Order Secured: Reports indicate that Google has placed an order with Intel's foundry unit for over three million of its custom Tensor Processing Units (TPUs) by 2028, which could significantly enhance Intel's competitiveness in the AI processor market and potentially boost its stock price.
- Foundry Business Growth: Intel's foundry business generated $5.4 billion in revenue in Q1 2026, marking a 16% year-over-year increase and accounting for 40% of the company's total revenue, showcasing strong performance particularly through partnerships with major clients like Tesla and Apple.
- Future Growth Potential: Despite Intel's high price-to-earnings ratio of 141, analysts anticipate solid earnings growth driven by new customer orders, which could provide long-term growth momentum and bolster investor confidence in the company's prospects.
See More
Intel's Foundry Business Gains Strong Momentum
- Surge in Foundry Orders: Google has partnered with Intel to manufacture over three million Tensor Processing Units (TPUs) by 2028, indicating significant market demand for Intel's foundry services, which is expected to further boost the company's revenue growth.
- Significant Revenue Growth: Intel's foundry business generated $5.4 billion in revenue in Q1 2026, marking a 16% year-over-year increase and accounting for 40% of the company's total revenue, showcasing its strong performance in the semiconductor market, outpacing the overall 7% revenue growth.
- Expanding Customer Base: In addition to Google, Intel has secured a foundry order from Tesla and is in talks with Apple, which will provide long-term growth potential for Intel's foundry business and enhance its competitive position in the market.
- Optimistic Market Outlook: Despite Intel's high price-to-earnings ratio of 141, analysts anticipate that its earnings growth will exceed expectations, and with the ongoing development of its foundry business, investors maintain an optimistic view on its future performance, potentially driving the stock price higher.
See More
Casey's Reports Record Fiscal Year Earnings
- Significant Earnings Growth: Casey's General Stores reported its fourth-quarter earnings with a remarkable 66.2% year-over-year increase in EPS, achieving $714 million in net income and nearly $1.5 billion in EBITDA, showcasing the company's strong profitability and market competitiveness.
- Consistent Dividend Increases: The company raised its quarterly dividend by 14% for the 27th consecutive year, which not only reflects its commitment to shareholder returns but also boosts investor confidence, likely driving the stock price higher.
- Successful Strategic Plan Completion: CEO Darren Rebelez noted the successful conclusion of a three-year strategic plan on a high note, and while same-store sales growth is expected to moderate to 2% to 5%, the company maintains a solid operational foundation.
- Positive Market Reaction: Following the earnings report, Casey's stock gained approximately 1% in pre-market trading, indicating investor optimism regarding the company's future growth potential, particularly in the expanding convenience store and gas station sectors.
See More
U.S. Government Invests in Quantum Computing Firms
- Government Investment Context: The U.S. government announced up to $100 million in equity investments in quantum computing firms, including D-Wave Quantum and Rigetti Computing, marking an unconventional investment strategy aimed at enhancing national security and reducing reliance on foreign competitors during economic pressures.
- Rigetti's Development Challenges: Rigetti is set to receive $100 million for R&D, yet its superconducting quantum computing technology, while fast, significantly lags in accuracy compared to other techniques, leading to delays in its new system release and exclusion from DARPA's Quantum Benchmarking Initiative.
- D-Wave's Technological Edge: D-Wave Quantum will also receive $100 million to focus on its 100,000-qubit annealing system and 10,000-qubit gate-model system, excelling in optimization problem-solving, but still needs to advance in traditional gate-based quantum computing.
- Diverse Investment Analysis: The investments span various quantum computing technologies, including superconducting, annealing, and neutral-atom methods, indicating a broad government bet on competing technologies rather than validation of individual stocks, suggesting that both D-Wave and Rigetti remain highly speculative investment choices.
See More
Intel Shares Surge 168% Amid Earnings Growth
- Strong Financial Performance: Intel's Q1 fiscal 2026 revenue rose 7% year-over-year to $13.6 billion, with non-GAAP EPS at $0.29 and net income soaring 156% to nearly $1.5 billion, indicating significant improvements in financial and operational metrics.
- Rising Data Center Demand: Demand for Intel's Xeon server CPUs is outpacing supply, particularly in AI data centers, with management noting that the CPU-to-GPU ratio may shift from 7:1 to 3:1 as workloads transition to inference, enhancing Intel's potential in AI infrastructure growth.
- Strengthened Partnerships: In April 2026, Google expanded its multiyear partnership with Intel to utilize Xeon CPUs for AI inference and cloud workloads, providing Intel with clearer visibility into future data center demand and stable chip requirements over the next three to five years.
- Manufacturing Technology Challenges: Despite generating $5.4 billion in revenue from its Foundry segment in Q1, Intel faced an operating loss of approximately $2.4 billion and a GAAP loss of $0.73 per share, with management anticipating a decline in PC demand in the second half of 2026, indicating that the company's turnaround relies heavily on data center demand and successful execution of its 18A technology.
See More
Intel Partners with Major Tech Giants
- Partnership Expansion: Intel is forming partnerships with several leading tech companies globally, aiming to enhance product competitiveness through technology integration, although specific details of these collaborations remain undisclosed, this move could strengthen its market position.
- Market Response Stable: As of the afternoon of June 8, 2026, Intel's stock price stood at $0.54, indicating a cautiously optimistic market reaction to its partnership strategy, with no significant fluctuations observed, reflecting investor expectations for future growth.
- Integration Potential: Collaborations with major tech firms may provide Intel with new opportunities for technology integration, enhancing its innovation capabilities in the semiconductor industry, thereby driving long-term growth.
- Strategic Implications: By partnering with industry leaders, Intel not only expands its product offerings but also maintains a competitive edge in a fiercely contested market, thereby increasing its influence within the global tech ecosystem.
See More
Intel's Stock Fluctuations and New Order Outlook
- Stock Performance Volatility: Intel's shares have surged 427% over the past year, yet they have declined over 16% since hitting a 52-week high on May 11, indicating investor concerns about its future prospects amid a broader semiconductor market downturn.
- Major Order Secured: Reports indicate that Google has placed an order with Intel's foundry unit for over three million of its custom Tensor Processing Units (TPUs) by 2028, which could significantly enhance Intel's competitiveness in the AI processor market and potentially boost its stock price.
- Foundry Business Growth: Intel's foundry business generated $5.4 billion in revenue in Q1 2026, marking a 16% year-over-year increase and accounting for 40% of the company's total revenue, showcasing strong performance particularly through partnerships with major clients like Tesla and Apple.
- Future Growth Potential: Despite Intel's high price-to-earnings ratio of 141, analysts anticipate solid earnings growth driven by new customer orders, which could provide long-term growth momentum and bolster investor confidence in the company's prospects.
See More
Intel's Foundry Business Gains Strong Momentum
- Surge in Foundry Orders: Google has partnered with Intel to manufacture over three million Tensor Processing Units (TPUs) by 2028, indicating significant market demand for Intel's foundry services, which is expected to further boost the company's revenue growth.
- Significant Revenue Growth: Intel's foundry business generated $5.4 billion in revenue in Q1 2026, marking a 16% year-over-year increase and accounting for 40% of the company's total revenue, showcasing its strong performance in the semiconductor market, outpacing the overall 7% revenue growth.
- Expanding Customer Base: In addition to Google, Intel has secured a foundry order from Tesla and is in talks with Apple, which will provide long-term growth potential for Intel's foundry business and enhance its competitive position in the market.
- Optimistic Market Outlook: Despite Intel's high price-to-earnings ratio of 141, analysts anticipate that its earnings growth will exceed expectations, and with the ongoing development of its foundry business, investors maintain an optimistic view on its future performance, potentially driving the stock price higher.
See More
Casey's Reports Record Fiscal Year Earnings
- Significant Earnings Growth: Casey's General Stores reported its fourth-quarter earnings with a remarkable 66.2% year-over-year increase in EPS, achieving $714 million in net income and nearly $1.5 billion in EBITDA, showcasing the company's strong profitability and market competitiveness.
- Consistent Dividend Increases: The company raised its quarterly dividend by 14% for the 27th consecutive year, which not only reflects its commitment to shareholder returns but also boosts investor confidence, likely driving the stock price higher.
- Successful Strategic Plan Completion: CEO Darren Rebelez noted the successful conclusion of a three-year strategic plan on a high note, and while same-store sales growth is expected to moderate to 2% to 5%, the company maintains a solid operational foundation.
- Positive Market Reaction: Following the earnings report, Casey's stock gained approximately 1% in pre-market trading, indicating investor optimism regarding the company's future growth potential, particularly in the expanding convenience store and gas station sectors.
See More
U.S. Government Invests in Quantum Computing Firms
- Government Investment Context: The U.S. government announced up to $100 million in equity investments in quantum computing firms, including D-Wave Quantum and Rigetti Computing, marking an unconventional investment strategy aimed at enhancing national security and reducing reliance on foreign competitors during economic pressures.
- Rigetti's Development Challenges: Rigetti is set to receive $100 million for R&D, yet its superconducting quantum computing technology, while fast, significantly lags in accuracy compared to other techniques, leading to delays in its new system release and exclusion from DARPA's Quantum Benchmarking Initiative.
- D-Wave's Technological Edge: D-Wave Quantum will also receive $100 million to focus on its 100,000-qubit annealing system and 10,000-qubit gate-model system, excelling in optimization problem-solving, but still needs to advance in traditional gate-based quantum computing.
- Diverse Investment Analysis: The investments span various quantum computing technologies, including superconducting, annealing, and neutral-atom methods, indicating a broad government bet on competing technologies rather than validation of individual stocks, suggesting that both D-Wave and Rigetti remain highly speculative investment choices.
See More
