Intel stock surged 25% after Nvidia announced a $5 billion investment in the struggling company. The two will collaborate on developing custom data center and PC products, with Intel providing x86 architecture chips for Nvidia’s AI servers. This move comes as Intel has struggled to keep up in the AI race.

Earlier this year, the US government took a 10% stake in Intel, following talks of splitting the company with TSMC. Softbank also invested $2 billion in Intel. Intel’s attempts to compete with Nvidia in AI chip design and manufacturing have fallen short, leading to partnerships like this one.

Intel CEO Lip Bu Tan aims to focus on the company’s CPU business and partner with AI chipmakers like Nvidia. Analysts see this deal as a game changer for Intel, bringing them into the AI game. A joint press conference will discuss the partnership further. Nvidia CEO Jensen Huang called it a fusion of two world-class platforms for the future of computing.

Read more at Yahoo Finance: Intel stock surges as Nvidia announces $5 billion stake in company