Intel Stock Finds Momentum on Potential Nvidia Partnership

Intel investors have experienced significant volatility recently, with sentiment shifting dramatically over a short period. The initial trigger was a cautious forecast for early 2026, but reports of a potential manufacturing deal with industry leader Nvidia have since fueled a notable rebound in investor confidence.

Adding a layer of intrigue to the recent developments, Intel's Chief Financial Officer, David Zinsner, engaged in share purchases in late January. Such moves by top executives are traditionally viewed as a signal of internal confidence in the company's trajectory.

The more substantial shift in narrative, however, came from supply chain reports. Nvidia is reportedly considering Intel Foundry Services to manufacture components for a future GPU. The partnership would involve an Input/Output die for a graphics processing unit potentially launching around 2028, utilizing Intel's advanced 18A fabrication process or its upcoming 14A technology. A concrete agreement would send a powerful message, validating Intel's foundry ambitions and aligning it with the dominant force in the artificial intelligence chip market.

Solid Earnings Met by Cautious Guidance

The backdrop to this news is Intel's latest financial report. The company's performance for the fourth quarter of 2025 exceeded analyst expectations, with revenue reaching $13.67 billion and adjusted earnings per share coming in at $0.15. These results indicate that the firm's extensive restructuring and cost-cutting measures are beginning to yield positive effects.

Should investors sell immediately? Or is it worth buying Intel?

The optimism from these results was quickly tempered by the outlook provided for the first quarter of 2026. Company leadership struck a deliberately reserved tone, citing persistent CPU production constraints. These bottlenecks are particularly affecting the data center and AI chip segments. CFO David Zinsner indicated that a meaningful improvement in the supply situation is not anticipated until after Q1 concludes.

The AI Catalyst and Intel's Positioning

The broader semiconductor industry continues to be reshaped by the relentless demand for artificial intelligence capabilities. Need for high-performance chips capable of handling complex AI workloads is accelerating, prompting companies to seek diversified manufacturing partnerships to strengthen their supply chains.

Intel is aiming to capture a portion of this growth with products like its new Intel® Core™ Ultra Series 3, described as its first processor platform architected specifically for AI PCs. Market analysts project the strongest growth in the coming years will be within the server and networking segments, largely driven by advancements in generative AI.

The near-term path for Intel's stock appears to hinge on two key factors: the company's ability to swiftly resolve its production shortages, and whether the discussions with Nvidia evolve into a firm, high-volume contract. Upcoming quarterly reports will be scrutinized for evidence that Intel is successfully executing a sustained operational turnaround.