Intel (INTC) Stock Jumps 11% as Google, Nvidia Reportedly Turn to Intel for AI Chips

TLDR

• Intel stock jumped ~11% Monday, leading the S&P 500 after a 13.5% drop last week
• The Information reports Google may order 3 million AI chips from Intel in 2028
• Nvidia and Tesla are also rumored to be exploring Intel as a chip manufacturer
• Morgan Stanley highlights strong server CPU demand and a beat-and-raise outlook near term
• Intel has gained 422% over the past 12 months; Wall Street consensus remains a Hold with a $98.15 price target

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Intel stock clawed back hard on Monday, jumping roughly 11% to around $110 after losing 13.5% last week when semiconductor stocks shed $1 trillion in market cap in a single brutal session.

Intel Corporation, INTC

The bounce put Intel at the top of the S&P 500 leaderboard for the day. The broader index gained 0.8%, while the Nasdaq rose 1.4%. Intel left both in the dust.

The catalyst? A report from The Information that Alphabet’s Google may have placed an order for Intel to manufacture 3 million tensor processing units — TPU AI chips — in 2028. The order is unconfirmed, and neither Google nor Nvidia responded to requests for comment. Intel declined to comment.

That didn’t stop investors from piling in.

Rumors didn’t stop at Google. Street Insider also reported that Nvidia may tap Intel as a contract manufacturer to build a new processor combining four Nvidia GPUs into a single unit. Tesla reportedly could partner with Intel, or license its next-generation 14A manufacturing process for its own chips at a facility dubbed Terafab.

Three major potential customers. All unconfirmed. All moving the stock.

Server CPU Demand Adding Fuel

Beyond the rumor mill, there’s a more grounded reason for optimism. Morgan Stanley analyst Joseph Moore wrote on June 1 that Intel continues to see strong server CPU trends.

Moore said the server roadmap — not foundry opportunities — remains the most important part of the Intel story. He noted Intel has a “clear ability to beat-and-raise near term given server CPU shortages.”

Intel CEO Lip-Bu Tan backed that up at Computex in Taiwan last week, saying CEOs have been calling him over the past month asking for more CPUs to meet demand.

Intel also announced a partnership with Apple supplier Foxconn last week to develop AI infrastructure, adding another layer to its manufacturing ambitions.

The Numbers Behind the Rally

The chip sector broadly recovered Monday. Broadcom gained 2.7%, AMD rose 4%, and Nvidia added 1.6% after Friday’s PHLX Semiconductor Index posted its worst single-day drop since 2020.

But Intel’s move stood apart. The stock is up 190% in 2026 alone and has surged 422% over the past 12 months.

Despite that run, Wall Street hasn’t fully bought in. Of 51 firms tracked by FactSet, the average rating on Intel is Hold, with a price target of $98.15 — well below where the stock is trading.

The valuation is a sticking point. Intel is currently unprofitable and trading at more than 120 times next year’s estimated earnings.

Intel’s market cap now sits at approximately $498 billion. The stock traded in a range of $106.66 to $112.36 on Monday, with average daily volume around 122.9 million — volume that reflects just how closely this one is being watched.