Google has placed an order with Intel to manufacture more than three million of its in-house tensor processing units in 2028, while Nvidia is evaluating Intel’s advanced packaging and its most cutting-edge 18A process for future chips, The Information reported on Monday, citing four people with direct knowledge of the talks. Intel’s shares jumped about 12 per cent on the news.
The shift is being driven by scarcity at TSMC, the Taiwanese manufacturer behind virtually every leading-edge Artificial Intelligence chip. Demand is straining TSMC’s capacity, especially in advanced packaging lines that combine chips and memory, making reliance on a single supplier in a single country a strategic risk for major chip designers.
Google’s is a firm order: more than three million TPUs in 2028, after months of testing Intel’s packaging, part of a build-out Morgan Stanley estimates at over six million TPUs across 2027 and 2028. Nvidia has not committed. It is running early trials, including multiproject wafer runs on 18A, and testing whether Intel can build a processor that fuses four graphics chips into one, a design tied to its Feynman GPU architecture due in 2028.
For Intel, the interest marks a meaningful step in its long effort to build a contract-manufacturing business capable of challenging TSMC. The company has struggled with heavy losses and limited foundry traction, despite courting Apple and receiving equity backing from the US government and Nvidia.
The clearest near-term opportunity appears to be advanced packaging rather than leading-edge chipmaking, where Intel still trails TSMC. SK Hynix is reportedly testing whether its high-bandwidth memory works reliably with Intel’s packaging too. TSMC remains far ahead, but Google’s order and Nvidia’s trials suggest the Artificial Intelligence industry’s largest buyers are actively seeking alternatives rather than keeping all critical production concentrated in Taiwan.
