A former Silicon Valley leader is working hard to make sure investors don’t count it out. Intel (NASDAQ:INTC) has struggled consistently throughout the year, dropping more than 36% year-to-date (YTD). Even as the artificial intelligence (AI) arms race has taken over markets, rising competition has made it difficult for Intel to contend with larger peers such as Nvidia (NASDAQ:NVDA) and Advanced Micro Devices (NASDAQ:AMD). But INTC stock rose in pre-market trading today on news that the company is at work on delivering new Xeon 6 processors for data centers. Trading has been volatile since markets opened, but this raises the question of whether or not INTC is a potential winner among the AI stocks of 2025.
Does this mean that investors should be watching Intel as the company maneuvers to compete with Nvidia and AMD? Let’s take a closer look at this news and assess what is likely to happen in the fast-growing chip market.
What’s Happening With INTC Stock
As noted, INTC stock rose briefly today in pre-market trading. However, things haven’t gone as well since Wall Street’s opening bells sounded. As of this writing, INTC stock is down slightly. While its current trajectory hints that a rebound is possible, it doesn’t change the fact that the company is struggling to gain momentum, even in the face of positive news. This suggests that the market doesn’t have much faith in Intel.
That could be because its news is being overshadowed by updates from competitors. Nvidia recently announced that it is at work on delivering two new innovations and that it plans on producing new AI accelerators faster. AMD unveiled its own new chips, intended to power AI computers. Both companies made these announcements at the Computex tech conference in Taipai, Taiwan over the weekend.
There’s no question that competition within the AI market is fierce. But Intel isn’t backing down. CEO Patrick Gelsinger discussed its newest innovation at the conference, highlighting the new chip’s applications for the lucrative data center market. As he stated:
“Customers are looking for high performance, cost-effective gen AI training and inferencing solutions. And they’ve started to turn to alternatives like Gaudi. They want choice. They want open software and hardware solutions and time to market solutions at dramatically lower TCOs [total cost of ownership].”
It’s true that many customers are looking to expand operations into generative AI training as they develop their own language models. But in an era in which Nvidia owns most of the market, and even AMD is struggling to compete with it, it will be difficult for any company, even a well-established tech player like Intel, to mount any serious competition.
What It Means
The AI revolution is fascinating to watch as companies roll out game-changing innovations. But Intel hasn’t done much recently and hasn’t given investors much cause for optimism. It’s hard to be excited about a struggling leader of yesterday when the trendier leaders of today are consistently making headlines and dominating the conversation on both Wall Street and r/WallStreetBets.
Additionally, even if Intel moves forward with its new chip plans, there are other points of concern that investors shouldn’t ignore. As InvestorPlace contributor Tyrik Torres notes, the increased tariffs against China puts certain companies at serious risk, and Intel is one of them. This means that the road ahead looks difficult for INTC stock, even if it can catch some new product momentum.
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
