Google turns to Intel for custom AI chips to rival Nvidia

Alphabet’s Google has placed a massive order with Intel to manufacture more than three million of its in-house Tensor Processing Units (TPUs) in 2028, according to a report by The Information. The news sent Intel’s shares soaring over 9% in early trading, building on the company's impressive 169% stock gain this year as CEO Lip-Bu Tan steers a steady turnaround.

The reported deal marks a major victory for Intel’s contract manufacturing business as it fights to reclaim its chipmaking crown from Taiwan Semiconductor Manufacturing Co. (TSMC). Skyrocketing demand from the artificial intelligence boom has left TSMC facing a severe capacity crunch, prompting major tech giants to diversify their supply chains. Analysts also note that partnering with Intel allows companies like Google to support U.S.-based manufacturing, strengthening their standing with the Trump administration, News.Az reports, citing Reuters.

Google’s order is part of its ongoing strategy to establish its custom TPUs as a viable alternative to Nvidia's market-dominant GPUs, with the proprietary chips already driving significant growth for Google’s cloud revenue. Meanwhile, Nvidia is reportedly evaluating Intel’s technology to manufacture a next-generation processor that combines four graphics chips into a single unit, though a formal order has not yet been placed.

This momentum follows a string of high-profile wins for Intel, which has recently secured billions in investments from Nvidia, SoftBank, and the U.S. government. Intel also recently locked in Tesla as its first major customer for its advanced 14A manufacturing process to support Elon Musk's "Terafab" AI project in Austin, alongside a preliminary deal to manufacture chips for Apple.

News.Az 

By Aysel Mammadzada