Nvidia Intel deal implications, according to Wall Street analysts

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Wall Street analysts think through the Nvidia-Intel deal

TL;DR: Huge for Intel, helpful for Nvidia, and potentially bad for AMD.

9/18/25 12:23PM

Intel shares were on a tear Thursday after Nvidia announced a $5 billion equity investment in the iconic, but struggling, American chipmaker.

Such a price shock suggests a major rethink of the outlook for Intel. But the nature of that rethink is worth digging into.

Wall Street analysts are already out with some notes giving thoughts on the implications of the deal. Here are a few, with some Sherwood News-provided translations, where appropriate, for those less than fluent in semiconductor-speak.

Evercore ISI

“We view the announcement as a positive for both companies: 1) for NVDA because custom x86 DC CPUs should translate to improved performance for its x86-CPU-based AI infrastructure, and it is extending its NVLink ecosystem into INTC products, and 2) for INTC, as the collaboration could help stem share loss to AMD in both DC and PC CPUs. Also, we view the NVDA investment in INTC as an important commitment and potentially initial step towards deeper collaboration.”

Translation: In AI data centers, Nvidia GPUs — the processing units the company is best known for — are often used in combination with Intel’s CPU chips.

So if Nvidia can collaborate on making custom Intel chips using Intel’s proprietary x86 architecture, it might improve the overall performance of Nvidia’s AI systems.

Also, the collaboration could mean the superfast connections Nvidia has developed to link up its GPUs (called NVLink) might start to be used more with Intel CPUs, which hasn’t been typical.

For Intel, the deal could bolster its sales of CPUs both for data centers as well as personal computers, where its dominance has been eaten way by Advanced Micro Devices.

Mizuho

“Near term, this positions INTC better as it develops custom Server CPUs and markets with NVDA, and gives NVDA a new market to increase NVLink and RTX GPU penetration, while a challenge for AMD. We believe the INTC-NVDA partnership could put AMD at a competitive disadvantage.”

Bernstein Research

“This looks like a product deal, not a foundry deal (at least for now). From the press release on the PC side Intel will ‘build and offer to the market x86 system-on-chips that integrate NVIDIA RTX GPU chiplets,’ and on the datacenter side ‘Intel will build NVIDIAcustom x86 CPUs that NVIDIA will integrate into its AI infrastructure platforms and offer to the market.’

“Hence while there would seem to likely be some packaging business in there for Intel there does not seem to be any agreements or commitments on the wafer foundry side (yet).

“But frankly Intel can use the help on the product business just as much given share position in key markets has been bleeding.”

Translation: The deal seems primarily focused on development of new semiconductor products that should improve Intel’s access to the fast-growing AI market, rather than on making Nvidia a customer for Intel’s troubled contract manufacturing business, or “foundry,” where it produces chips for others. (The troubled foundry division has been a long-standing headache for the company.)

Wedbush Securities

“This is a game changer deal for Intel as it now brings them front and center into the AI game. Along with the recent US Government investment for 10% this has been a golden few weeks for Intel after years of pain and frustration for investors... This partnership focuses on leveraging NVDA’s AI and accelerated computing stack with Intel’s CPUs and vast x86 ecosystems to lay the foundation for the next wave of computing with AI.”

Jon Keegan19m

Meta shares rally as Jefferies says it’s a bargain relative to Mag 7 peers

Shares of Meta rallied over 5% today, as Jefferies analyst Brent Thill doubled down on his buy rating for the company, calling the stock a relative bargain compared to its Magnificent 7 peers. The analyst set a price target of $910, well above the $645 where the stock is trading today.

News out of Davos this week that Meta’s first models from its revamped AI teams are “very good” align with Thill’s argument that the company is well positioned to get back in the AI race with the “all-star model,” which is expected to be released in the first half of the year.

Recent cuts to its Reality Labs also signal that the company is focusing its spending where it matters. The Jefferies note also said the recent monetization of Threads via ads will help boost revenue.

Next week, Meta reports its fourth-quarter earnings, and Thill expects that even if Meta raises its 2026 capex outlook, investors won’t be spooked, as the company has been clear that spending may continue to be high.

Matt Phillips2h

Arista Networks rips higher amid jump in call buying

Arista Networks, a maker of switches and other networking equipment used in AI data centers, was on track for its best day of the new year on Thursday as options traders went bullish on the stock.

As of around 11 a.m. ET, there was nearly twice as much call buying in Arista than its 10-day moving average for a full day of activity. Buying call options to make leveraged bets on price increases has been a favorite trading tactic of retail traders in recent years.

Otherwise, there weren’t clear headlines tied to today’s outsized move, but the stock has been getting attention lately: in a note published earlier this month, Goldman Sachs analysts spotlighted Arista as a top tactical trade for earnings season, saying the shares — which they rate a “buy” — could rise 20% over the next year.

“ANET is well positioned amidst ongoing data center spending growth, where its position as a best of breed provider of networking equipment should advantage the company, particularly as data center networks become increasingly complex,” Goldman analysts wrote in the January 8 report.

And recent reports also say Microsoft — which accounted for 20% of Arista’s revenue in 2024, according to Goldman Sachs — is planning a massive expansion of its Wisconsin data center project.

Arista stock did get a lift following the release of solid US economic numbers at 8:30 a.m. that seemed fairly specific to Arista itself. (There was no similar bounce from competitors like Cisco or Hewlett-Packard.)

Microsoft receives preliminary approval for $13.3B data center expansion in Mount Pleasant - Milwaukee Business Journal

And recent reports also say Microsoft — which accounted for 20% of Arista’s revenue in 2024, according to Goldman Sachs — is planning a massive expansion of its Wisconsin data center project.

Luke Kawa3h

Investors just made a mammoth $133 billion flip from cash to stocks, per Goldman Sachs

It’s a dash from cash, with investors taking billions in dry powder and pouring that money into the stock market.

“We saw strong net flows into global equity funds last week, led by stronger inflows into US and EM equity funds (+$71 billion vs $2 billion in the previous week) — more than 35x-ed the flows,” wrote Goldman Sachs’ Gail Hafif, Brian Garrett, and Lee Coppersmith. “While equity flows increase, money market fund assets fell by $62 billion. This is the 3rd largest level in our dataset (!).”

The trio is bullish on US stocks, seeing “the case for contained selloffs coupled with relief rallies as the most likely path forward in the near term.”

Luke Kawa

Retail traders’ monthly appetite for stocks ascends to fresh record

“The current ‘new year’ momentum has been sustained and has now pushed retail activity to an all-time high on a rolling monthly basis,” according to JPMorgan.

BRITAIN-LONDON-FIREWORKS-NEW YEAR-CELEBRATION

J. Edward Moreno4h

Moderna extends rally on positive cancer vaccine results

Moderna has more than doubled since it announced on Tuesday that its cancer vaccine reduced the risk of relapse or death for melanoma patients.

The five-year data from a Phase 2b trial showed that Moderna’s vaccine, when used with Merck’s blockbuster treatment Keytruda, reduced the risk of recurrence or death by 49% compared with Keytruda alone. The news gave investors hope that Moderna, which is best known for quickly developing a COVID-19 vaccine, may soon have another lucrative product in its portfolio.

Last week, Moderna said it expects to report total 2025 revenue of $1.9 billion, on the high end of its latest guidance of between $1.6 billion and $2 billion, amid better-than-expected vaccination rates. As demand for the COVID-19 vaccine, its sole revenue-generating product, has tanked, the company has aggressively cut costs and focused on expanding its portfolio.

The combination of positive announcements early in the year has made Moderna the second-best performer in the S&P 500 Index in 2026, behind newfound AI darling Sandisk.