Intel (INTC) Stock Soars 11% Following Major Google TPU Contract and Cadence Partnership

Intel’s stock jumped 11% after Google agreed to purchase over 3 million tensor processing units (TPUs) from Intel for delivery in 2028. The deal highlights Intel’s growing role in AI hardware, driven by its advanced packaging capabilities and limited alternatives like TSMC’s capacity constraints. Intel’s shares rose to $112.44 in premarket trading, extending a two-day rally and marking a 500% gain over the past year. Nvidia is reportedly evaluating Intel’s 18A manufacturing process and EMIB packaging for its next-gen 'Feynman' GPU platform, though no formal contract exists. The potential collaboration between two AI computing leaders has bolstered investor confidence, despite Intel declining to comment on the reports. Intel also expanded its partnership with Cadence Design Systems to refine its upcoming 14A chip technology, a move industry analysts say signals strong demand for high-performance mobile wafers. Cadence’s stock climbed 4.8% following the announcement, with experts noting the agreement reflects confidence in Intel’s future production capabilities. Wall Street firms upgraded their price targets for Intel, with Wells Fargo raising its forecast to $110, Barclays to $100, and Mizuho to $128. Analysts cited rising AI data center demand and the growing importance of CPUs in AI applications as key drivers. Broader semiconductor stocks also advanced, including TSMC (+2.8%) and Nvidia (+1.7%), as the Nasdaq and S&P 500 saw modest gains in premarket trading. Intel CEO Lip-Bu Tan emphasized that AI-driven demand, particularly for inference and agentic AI, is accelerating the need for its CPUs and advanced packaging solutions. The Google TPU contract and Cadence collaboration underscore Intel’s push to compete in the AI hardware market, where it has lagged behind rivals like Nvidia and AMD.