HIGHLIGHTS
- Until early last year, Intel produced almost entirely its own processors.
- Intel's stock increased by up to 2.5 percent.
- Qualcomm and Amazon have been named as Intel's clients.
Nvidia Chief Executive Officer Jensen Huang stated on a conference call with reporters on Wednesday that the company is interested in studying the possibility of employing Intel to manufacture its processors.
"They are interested in having us use their foundries. We're quite interested in looking at it "Huang stated. However, he stressed that foundry negotiations take a long time since they involve integrating supply networks.
Intel opted to extend its business into building chips that others design as well, known as the foundry industry, early last year, and has launched numerous multibillion-dollar projects for new production sites in the United States and Europe.
Following Huang's remarks, Intel's stock climbed as high as 2.5 percent.
Investors have been waiting for chip design firms to make public promises to employ Intel's chip manufacturing. Intel said last year that Qualcomm and Amazon will be customers for its foundry division.
After a US Senate hearing on Wednesday, Intel CEO Pat Gelsinger told Reuters that his business is "thrilled for their interest in utilising our foundry capabilities." He stated that he had "no specific timetable." He acknowledged that talks with Nvidia were underway.
"I'm sure he wants more alternatives... and it doesn't cost him anything to express that," Bernstein analyst Stacy Rasgon said of Huang's remarks. "However, it doesn't tell you anything about what it's going to look like when they get there."
Currently, Taiwan Semiconductor Manufacturing Co. manufactures the majority of Nvidia chips, and Huang stated that "becoming a foundry of the quality of a TSMC is hard for the faint of heart," adding that it takes a cultural shift to give not just procedures but also service.
When asked if he would be concerned about working with a rival like as Intel, Huang stated that trusting and working with industry partners is critical, and Nvidia has been teaming with numerous firms, including Intel, for many years.
