Investing.com — Advanced Micro Devices (NASDAQ:AMD) stock fell 5% Thursday morning after rivals Nvidia (NASDAQ:NVDA) and Intel (NASDAQ:INTC) announced a strategic collaboration to develop AI infrastructure and personal computing products together.
The partnership between AMD’s two major competitors sent ripples through the semiconductor sector, with Intel shares jumping 30% while AMD investors showed concern about potential market share challenges. The collaboration will focus on connecting Nvidia and Intel architectures using Nvidia’s NVLink technology, combining Nvidia’s AI expertise with Intel’s CPU technologies.
Under the agreement, Intel will build custom x86 CPUs for Nvidia’s AI infrastructure platforms. For the personal computing market, Intel will develop x86 system-on-chips that integrate Nvidia RTX GPU chiplets, creating products that directly compete with AMD’s offerings in both the data center and consumer segments.
Nvidia also announced a $5 billion investment in Intel common stock at $23.28 per share, further cementing the partnership between the two tech giants.
The collaboration poses a significant competitive challenge to AMD, which has been gaining ground in both the CPU and GPU markets. AMD has positioned itself as a strong competitor to both Intel in CPUs and Nvidia in GPUs, particularly in AI applications. This new alliance between its two main rivals could potentially squeeze AMD’s market position in both segments.
The partnership announcement comes at a time when competition in AI computing infrastructure has intensified, with AMD working to strengthen its own position in the rapidly growing AI chip market.
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