Intel has had a rough few years. So Monday’s news landed like a jolt.
The Information reported that Google has placed an order with Intel to manufacture more than 3 million Tensor Processing Units in 2028. That sent Intel stock up more than 12% in morning trading.
The order follows months of testing Intel’s advanced packaging technology, according to the report, which cited four people with direct knowledge of the discussions.
TPUs are Google’s in-house AI chips, used to train and run AI models. Morgan Stanley estimates Google will produce more than 6 million TPUs across 2027 and 2028, making Intel’s slice of that a meaningful contract.
Nvidia hasn’t placed an order yet, but the company is evaluating whether Intel’s technology can manufacture a processor that combines four graphics chips into a single unit. That work is tied to Nvidia’s Feynman GPU architecture, set for release in 2028.
Nvidia is also running early-stage trials on Intel’s 18A process — its most advanced manufacturing node — through multiproject wafer runs.
The context here matters. TSMC has been under serious strain from the AI chip boom. Capacity constraints have hit both leading-edge wafer lines and advanced packaging. That’s pushing big customers to look elsewhere for manufacturing options.
Intel’s foundry business has been a problem area for years. Management mistakes allowed TSMC to pull far ahead in chip manufacturing. But this report is the latest sign that momentum may be shifting.
Tesla CEO Elon Musk said in April that Tesla plans to use Intel’s 14A manufacturing process — the generation after 18A — to make chips for its Terafab project, an advanced AI chip facility planned for Austin.
Google, Nvidia, and Intel did not respond to requests for comment. Reuters was unable to independently verify the report.
At the time of writing, INTC was up nearly 9%, NVDA gained around 2%, while GOOGL dipped about 1%. TSM dropped over 6%.
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