Intel shares extended gains for a seventh straight session Thursday after the semiconductor maker announced an expanded collaboration with Google to develop next-generation processors for artificial intelligence data centers.
The stock was up about 3% in morning trading, continuing a strong rally that has seen the stock climb 47.5% over the current seven-session run.
If sustained, the rise would mark Intel’s largest seven-day gain on record and its longest winning streak since September 2023, when it rose for nine consecutive sessions.
The stock had already closed near a five-year high on Wednesday, reflecting growing investor confidence in the company’s AI positioning.
Expanded partnership targets AI data center growth
The deal marks a multi-year collaboration between Intel and Google, under which the manufacturer will supply “multiple generations” of its Xeon central processing units (CPUs) for data centers.
This contract extends an existing relationship, with Google continuing to deploy Intel processors across a wide range of workloads, including inference and general computing.
Google is also expected to adopt Intel’s latest Xeon 6 processors as part of its infrastructure development.
The partnership highlights the growing importance of CPUs in AI ecosystems, particularly as the industry moves from model training to large-scale deployment.
In addition to CPUs, the two companies will expand the co-development of custom infrastructure processing units (IPUs). These chips are designed to offload networking, storage and security functions from CPUs, improving efficiency and enabling more predictable performance in hyperscale AI data centers.
“Scaling AI requires more than accelerators: it requires balanced systems,” said Intel CEO Lip-Bu Tan. “CPUs and IPUs are at the heart of delivering the performance, efficiency and flexibility needed for modern AI workloads.”
Rising CPU demand driven by shift to inference
The collaboration comes at a time when demand for traditional computer chips is on the rise again, driven by the rapid evolution of AI applications.
Companies are increasingly moving away from training large models to focus on inference – the process of running AI systems in real-world environments – creating renewed demand for general-purpose CPUs.
The rise of agent-based AI systems, which perform complex tasks in multiple steps, is further accelerating this trend.
These workloads require substantial processing power beyond specialized accelerators, positioning CPUs as a critical component of AI infrastructure.
Wall Street analysts have noted that demand for server CPUs is starting to outstrip supply, increasing the risk of new bottlenecks in AI development.
The dynamic could benefit Intel, which is working to regain market share after losing ground to competitors in the early stages of the AI boom.
Strategic moves strengthen Intel’s position
The expanded partnership with Google adds to a series of strategic moves by Intel aimed at strengthening its position in the AI ecosystem.
Earlier this month, the company announced its intention to pay [MONEY value=”14200000000″ currency=”usd” notation=”long” replace=”false”] to buy back a 49% stake in its Irish chip manufacturing joint venture from Apollo Global Management.
This operation demonstrates confidence in its manufacturing activity and the continued dynamism around CPUs.
Intel has also aligned itself with major AI-focused initiatives, including plans to participate in the Terafab chip complex project alongside companies linked to Elon Musk.
As demand for AI infrastructure continues to grow, the combination of strengthened partnerships, rising CPU relevance, and strategic investments is helping to reshape investor sentiment toward Intel.
The latest rally suggests that markets are increasingly incorporating a central role for society in the next phase of AI development.
