Key Points:
- Google is committed to using multiple generations of Intel Xeon 6 processors for its artificial intelligence data centers.
- Intel shares jumped nearly 5.0% on Thursday following the announcement of the expanded hardware partnership.
- The United States government and Nvidia recently invested heavily in Intel, boosting the stock price over the past 12 months.
- The two tech giants will also continue developing infrastructure processing units to handle heavy networking and security tasks.
Google plans to install multiple generations of Intel central processing units inside its massive artificial intelligence data centers. The two technology companies announced a major expansion of their existing hardware partnership on Thursday. Following the news, enthusiastic investors bought Intel stock, sending shares up nearly 5.0% before the market officially closed. Alphabet, the parent company of Google, also finished the trading session with modest financial gains.
The internet search giant has relied on Intel processors for almost 30 years. This relationship dates back to when Google first built its server racks. Now, Google will deploy the newest Xeon 6 processors to run heavy artificial intelligence training programs and inference workloads. This massive supply deal gives the legacy chipmaker a much stronger foothold in a highly lucrative market that Nvidia currently dominates.
Amin Vahdat, the chief technologist for artificial intelligence infrastructure at Google, released a public statement regarding the agreement. He stated that the product roadmap for the new Xeon chips gives his engineering team complete confidence. He believes Intel will help Google meet the exploding demands for performance and efficiency in its daily digital workloads. Neither company shared the specific financial terms of the deal or the exact delivery timeline for the new equipment.
Central processing units now take center stage in the ongoing artificial intelligence race. Dion Harris, the head of artificial intelligence infrastructure at Nvidia, spoke about this massive industry shift in March. He explained that these traditional processors currently act as a major system bottleneck. As software developers push complex agentic workloads, modern computers need much more power than the graphics processing units that ruled the industry over the past few years.
Intel Chief Executive Officer Lip-Bu Tan echoed this exact sentiment in his own corporate statement on Thursday. He noted that scaling artificial intelligence requires more than just standard hardware accelerators. He emphasized that technology companies need perfectly balanced systems to meet the extreme data-processing requirements of modern software.
This new Google deal adds to Intel’s massive winning streak. The chipmaker struggled for years to keep pace with technological trends, but recent investments have completely turned the company around. Last August, Intel sold a 10.0% ownership stake directly to the United States government. The Trump administration praised the company’s ability to manufacture highly advanced computer chips on American soil. One month later, Nvidia purchased a massive $5.0 billion stake in the manufacturer. Thanks to these heavy investments, Intel shares have nearly tripled over the past year.
Intel currently manufactures the latest Xeon processor using its advanced 18A technology. Factory workers build these specific components at a brand new fabrication plant in Arizona that opened last year. While Intel pours billions of dollars into its foundry business, the company still acts as its own largest customer at the new facility. However, Tan recently announced on LinkedIn that Elon Musk hired Intel to design and build custom computer chips. Musk wants these specialized parts for SpaceX, xAI, and Tesla to supply his massive Terafab project in Texas.
Beyond the standard processors, Google and Intel also confirmed they will continue collaborating on another unique piece of hardware. Since 2022, the two tech giants have worked together to build advanced infrastructure processing units. Intel explained that software developers use this programmable accelerator to handle routine background chores. The chip takes over network routing, data storage management, and security functions so the main processor can focus entirely on running complex artificial intelligence applications.
Google told reporters that this infrastructure processing unit represented a first-of-its-kind design when the company started the project four years ago. The chip handles heavy overhead tasks such as encrypting sensitive files and running virtualization software in traditional data centers. Even with this strong Intel partnership, Google still builds its own custom hardware to save money. For over a decade, the search company has developed its own tensor processing units. In 2024, Google also began manufacturing a custom central processor called Axion, choosing an Arm-based design instead of the traditional Intel architecture.
