Intel, Google Deepen AI Infrastructure Collaboration Days After Chipmaker Joins Tesla’s Terafab Project

• Google is doubling down on using central processing units for its AI systems, emphasizing their importance to accelerate its workloads.
• Google’s Amin Vahdat added that Intel’s roadmap for Xeon processors gives the company the confidence that it can continue to meet its increasing performance and efficiency requirements.
• Intel also struck a $14.2 billion deal with Apollo to reacquire its 49% stake in Fab 34 in Ireland, a high-volume fabrication facility for the company’s processors, like Xeon.

Intel Corp. (INTC) announced an expansion of its AI infrastructure collaboration with Alphabet Inc.’s (GOOG, GOOGL) Google to include multiple generations of Xeon processors.

Intel announced that the multi-year partnership with Google includes expanded co-development of custom ASIC-based infrastructure processing units (IPUs) to improve efficiency, utilization and performance at scale.

This comes days after Intel joined Tesla Inc.’s (TSLA) Terafab project to make processors to power the EV giant’s robotics and data center ambitions.

Intel shares gained nearly 4% in Thursday’s opening trade, while Alphabet’s Class A shares were down 2%. Retail sentiment on Stocktwits around Intel trended in the ‘extremely bullish’ territory at the time of writing.

Google Doubles Down On CPUs For AI

Google is doubling down on using central processing units (CPUs) for its AI systems, emphasizing their importance to accelerate its workloads.

“CPUs and infrastructure acceleration remain a cornerstone of AI systems—from training orchestration to inference and deployment,” said Amin Vahdat, SVP & Chief Technologist, AI Infrastructure, Google.

Vahdat added that Intel’s roadmap for Xeon processors gives the company the confidence that it can continue to meet its increasing performance and efficiency requirements.

“Scaling AI requires more than accelerators - it requires balanced systems. CPUs and IPUs are central to delivering the performance, efficiency and flexibility modern AI workloads demand,” said Intel CEO Lip-Bu Tan.

Intel Strikes Massive Deal To Fuel Its AI Ambitions

Intel struck a massive $14.2 billion deal with Apollo Global Management Inc. (APO) earlier this month. The chipmaker entered into an agreement with Apollo to repurchase its 49% equity stake in the Intel Fab 34 facility in Ireland.

The Fab 34 facility is a high-volume semiconductor fabrication facility for Intel’s products, like the Xeon 6 processor. This is the same processor family that Google has agreed to use for multiple generations, according to the agreement announced Thursday.

INTC stock is up 62% year-to-date, while GOOGL stock is up 1%. The Vanguard Total Stock Market Index Fund ETF (VTI) and the Vanguard S&P 500 ETF (VOO) are up 24% over the past 12 months.

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