According to The Information, Google has placed an order with Intel to manufacture more than three million tensor processing units (TPUs), with delivery scheduled by 2028. The report cites sources directly familiar with the discussions.
Why this matters for Intel
The order would be a significant boost to Intel’s foundry business as the company tries to regain ground against Taiwan Semiconductor Manufacturing Company (TSMC). Rapidly rising demand for AI chips has created capacity constraints at TSMC, prompting several major AI chip designers to seek alternative contract manufacturers, including Intel.
Interest from other chipmakers
Sources say Nvidia is also evaluating whether Intel’s technology could be used to produce a processor that combines four graphics chips into a single unit, although Nvidia has not placed an order. Intel declined to comment on the report; Alphabet and Nvidia did not immediately respond to requests for comment.
Market reaction and Intel’s broader position
Following the report, Intel shares rose more than 9 percent after the open, extending roughly a 169 percent year-to-date gain. Intel’s performance has shown signs of recovery since Lip-Bu Tan took over as CEO, and under the new leadership the company has received multibillion-dollar support and investment from the Trump administration, Nvidia and SoftBank.
Growing demand for Intel’s manufacturing capacity
Other market participants have also shown interest in Intel’s production capabilities. Elon Musk announced last April that Tesla plans to use Intel’s next-generation 14A manufacturing technology for its Terafab project in Austin. The Wall Street Journal recently reported that Intel has reached a preliminary agreement to manufacture certain chips for Apple.
Role of Google’s TPUs
Google positions its in-house AI chips, the TPUs, as direct alternatives to Nvidia’s market-leading GPUs. TPU sales are already an important growth driver for Google’s cloud-based services revenue, according to the report.
This article summarizes reporting based on Reuters. It does not constitute investment advice or a recommendation.
