Nvidia Corp. (NASDAQ:NVDA) recently stopped testing whether it would manufacture its advanced artificial intelligence chips using Intel Corp.’s (NASDAQ:INTC) 18A production process, according to people familiar with the matter.
The pause represents a setback for Intel as it works to win major external customers for its next-generation chip manufacturing business.
The tests were part of Intel’s push to position itself as a rival to the $1.5 trillion contract chipmaker Taiwan Semiconductor Manufacturing Company (NYSE:TSM), Reuters reported on Wednesday.
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Intel stock slid after the report.
Benzinga reached out to Intel and Nvidia investor relations for their take on the report and is awaiting their response.
Setback Comes Despite High-Profile Nvidia Investment
The development follows Nvidia’s $5 billion investment in Intel, announced earlier this year.
Nvidia and Intel announced a broad partnership to jointly develop several generations of custom data center and PC products, aiming to speed up AI and computing workloads across cloud, enterprise, and consumer markets.
The news sent Intel shares up more than 29%, giving the chipmaker another lift alongside recent U.S. government support.
At the time, Intel CEO Lip-Bu Tan emphasized that the companies were focused on collaboration instead of manufacturing agreements.
Nvidia CEO Jensen Huang echoed that view.
Intel Says Next-Gen Manufacturing Still On Track
Meanwhile, Intel said its 18A manufacturing technology is progressing well and continues to attract interest from potential customers.
It also highlighted its upcoming 14A process, which it says will deliver more powerful and energy-efficient chips.
Intel stock gained over 81% year-to-date, backed by Trump administration investments, Nvidia partnership, and reports indicating Apple Inc. (NASDAQ:AAPL) potentially using Intel for future M-series chips.
Meanwhile, Nvidia became the first company to top the $4.5 trillion market cap in October 2025, leapfrogging the likes of Apple, Alphabet Inc (NASDAQ:GOOGL), and Microsoft Corp (NASDAQ:MSFT).
INTC Price Action: Intel shares were down 3.27% at $35.16 during premarket trading on Wednesday, according to Benzinga Pro data.
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