Intel shares jump on Amazon AI chip deal
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The news: Intel shares surged as much as 8% after unveiling a multibillion-dollar deal to design and manufacture AI chips for Amazon’s cloud services unit, AWS.
The context: The deal is a significant win for Intel’s foundry business, which has struggled to secure high-profile customers.
CEO Pat Gelsinger is restructuring the company, turning the foundry division into a wholly owned subsidiary and pausing factory projects in Germany and Poland.
The numbers: Shares surged to as much as USD22.58 ($33.44) each, before paring gains to be 3.3% higher in the afternoon.
Intel also announced this week that it was awarded up to USD3 billion in US government funding to manufacture military chips.
As part of its broader cost-cutting measures announced last month, Intel plans to lay off 15,000 workers and save USD10 billion.
The sources: Intel memo, Bloomberg
