Trump posted Intel stock price

Nvidia announced Thursday that it will invest $5 billion in Intel, backing the struggling U.S. chipmaker just weeks after the White House brokered a landmark deal for the U.S. government to take a major stake in the company.

The move will make Nvidia one of Intel’s largest shareholders, with roughly a 4% stake or more once new shares are issued to complete the transaction.

For Intel, Nvidia’s support marks a significant turning point after years of failed turnaround efforts. The news sent Intel’s shares surging 30% in pre-market trading.

Intel, once the standard-bearer of the global chip industry and a pioneer in Silicon Valley, appointed Lip-Bu Tan as its CEO in March. His tenure quickly faced political scrutiny, with President Donald Trump among those calling for his resignation over concerns about his ties to China. That controversy led to urgent negotiations in Washington, culminating in Intel’s agreement to hand the U.S. government a 10% stake.

Nvidia — whose chips are central to the worldwide artificial intelligence boom — said it would pay $23.28 a share for Intel stock, slightly under Wednesday’s closing price of $24.90 but above the $20.47 per share the U.S. government paid for its stake last month.

“This reflects Nvidia’s effort to diversify its U.S. investments and build goodwill with Washington,” said Chris Beauchamp, chief market analyst at IG Group in London. “It doesn’t solve Nvidia’s bigger challenges in China, but it strengthens its standing with the U.S. government.”

The agreement also outlines plans for Intel and Nvidia to jointly develop PC and data center chips. Notably, the partnership excludes Intel’s contract manufacturing business — its foundry operations — meaning Intel will not be producing chips for Nvidia.

Analysts widely agree that Intel’s long-term survival in the foundry business hinges on eventually landing a major customer such as Nvidia, Apple, Qualcomm, or Broadcom.