Google said to tap Intel for massive AI chip order, boosting foundry ambitions

Reported order of more than three million AI processors for 2028 could strengthen Intel’s contract manufacturing business, while highlighting growing efforts by leading technology firms to diversify semiconductor production beyond a single supplier.

Alphabet-owned Google is reportedly preparing a significant manufacturing partnership with Intel, a move that could provide a major boost to the American chipmaker’s efforts to revive its semiconductor foundry business amid surging demand for artificial intelligence infrastructure.

According to reports, Google has placed an order with Intel to manufacture more than three million tensor processing units (TPUs) in 2028. TPUs are Google’s custom-designed chips developed to accelerate AI workloads and support the company’s expanding cloud and AI services.

The reported agreement comes at a crucial time for Intel, which is seeking to rebuild its position in the global semiconductor industry after years of losing ground to rival manufacturers. Under Chief Executive Lip-Bu Tan, the company has been working to attract high-profile customers to its contract chip manufacturing operations and re-establish itself as a leading alternative to established foundry players.

AI demand drives manufacturing diversification

The rapid expansion of artificial intelligence applications has intensified demand for advanced semiconductor production, placing significant pressure on existing manufacturing capacity. Taiwan Semiconductor Manufacturing Company (TSMC), the dominant global contract chipmaker, has been struggling to keep pace with demand from major AI chip designers.

Industry analysts view Google’s reported order as part of a broader effort by technology companies to reduce dependence on a single manufacturing partner. Jacob Bourne, a technology analyst at eMarketer, noted that the development reflects growing efforts by leading AI firms to diversify supply chains that remain heavily concentrated around TSMC.

The report also suggested that Nvidia is evaluating Intel’s manufacturing technology for a future processor design that would integrate four graphics processing units into a single package. However, no formal manufacturing commitment has been made by Nvidia at this stage.

Intel’s turnaround gains momentum

Investor optimism surrounding Intel’s recovery strategy has gathered pace in recent months. The company’s shares climbed more than 9% following the report, extending a strong rally this year as markets respond positively to signs of operational progress under Tan’s leadership.

Intel has recently secured support from major industry and government stakeholders while attracting interest from prominent technology companies. Reports have also indicated that Apple is exploring chip manufacturing arrangements with Intel, while Tesla has emerged as a customer for the company’s next-generation manufacturing technologies.

Neither Intel nor Google publicly confirmed the reported TPU order. Nvidia also did not comment on the matter. If finalized, however, the deal would represent one of the most significant endorsements yet of Intel’s ambition to become a major manufacturing partner in the rapidly expanding AI semiconductor market.