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Shares of Intel (NASDAQ:INTC | INTC Price Prediction) are up 12% in early Monday trading, climbing to $111. Investors are reacting to a newly announced strategic collaboration with Japan’s Hitachi alongside a wave of reports suggesting that Alphabet‘s (NASDAQ:GOOGL) Google and NVIDIA (NASDAQ:NVDA) could lean on Intel’s foundry as a backup AI chip supplier.
The move extends a remarkable run for INTC stock, which has soared 196% year to date. As recently as last June, Intel shares were changing hands near $20.
Today’s pop also helps Intel stock claw back recent ground. INTC shares had drifted slightly below $99 on Friday, leaving room for a momentum-driven rebound.
Hitachi Pact and Foundry Buzz Fuel the Rally
On June 5, Hitachi and Intel unveiled a strategic collaboration targeting “physical AI,” advanced computing, and next-generation digital infrastructure across manufacturing, energy, and mobility. The two companies plan to work across five strategic pillars: foundry tools, quantum computing, energy optimization, custom silicon and edge-AI applications, and factory automation.
The practical details matter. Hitachi’s high-precision metrology and etching data will feed its ExTOPE platform for predictive diagnostics and yield gains in chip manufacturing, while Hitachi’s HMAX Energy systems will be deployed inside Intel’s fabs. In return, Intel will supply high-voltage silicon chips for Hitachi’s power systems.
Intel CEO Lip-Bu Tan framed the deal in expansive terms, declaring, “The coming wave of physical AI will transform the industrial edge of our economy through new advances in robotics, autonomous machines, and other AI edge devices.” Hitachi CEO Toshiaki Tokunaga referenced “more than 40 years of trust with Intel.”
The second catalyst is more speculative. Reports suggest that Google and NVIDIA are considering Intel as a key backup manufacturer for AI chips to address supply-chain constraints, refocusing the spotlight on Intel’s 18A process.
The Bulls and the Bears Square Off
The bulls see real momentum behind Intel’s foundry pivot. The company’s Q1 2026 results showed non-GAAP EPS of $0.29 on revenue of $13.58 billion, with Intel’s Data Center and AI revenue jumping 22% year over year (YoY) to $5.05 billion.
Intel Foundry revenue also climbed 16% YoY, and the company logged its sixth consecutive quarter of revenue above expectations. Prior equity backing from NVIDIA ($5 billion) and SoftBank ($2 billion) lends outside validation to Intel’s AI thesis.
Not everyone is sold on the bull case, though. Intel’s foundry segment remains unprofitable, the company’s free cash flow ran at -$3.87 billion last quarter, and Wall Street’s consensus analyst price target sits at just $89, well below today’s quote. Skeptics also warn that the Google and NVIDIA chatter is just talk until contracts get signed.
Furthermore, the company’s valuation is stretched. Intel stock trades at a forward P/E ratio of 123x with a beta of 2.23, leaving little room for execution stumbles. Analyst ratings remain heavily clustered at Hold, with 31 Hold ratings against 12 Buys and 5 Sells for INTC stock.
What to Watch Next
Investors can watch for whether Intel stock holds the $110 level in the coming days, especially with a 52-week high of $133 that the bulls would love to retest. Confirmation of the rumored Google and NVIDIA foundry deals could become the next major catalyst.
Intel’s own Q2 2026 guidance calls for revenue of $13.8 billion to $14.8 billion, so any forward commentary from CEO Lip-Bu Tan in coming weeks could shape sentiment quickly. Traders may want to size their share positions carefully in a stock that’s this volatile.
