Intel’s Strategic Pivot: A Potential $1.6 Billion AI Acquisition in Focus

Intel is actively reshaping its artificial intelligence strategy, with market participants closely monitoring its next move. Recent reports have clarified the status of a significant potential acquisition, moving beyond earlier speculation to reveal that while talks are advanced, a final agreement has not yet been reached.

The State of Play

Contrary to initial market narratives, Intel has not finalized a deal. On December 9, 2025, the company signed a non-binding term sheet with AI chip startup SambaNova Systems. This document outlines the core structure of a potential transaction but carries no legal obligation for either party to conclude the purchase.

The key parameters under discussion include:

• Target: SambaNova Systems, a startup specializing in AI chips for data centers.
• Estimated Value: Approximately $1.6 billion, including assumed debt.
• Current Status: Advanced negotiations are ongoing, but no definitive purchase agreement is in place.
• Strategic Rationale: Intel seeks access to SambaNova’s “Reconfigurable Dataflow Units” (RDUs) to enhance its AI inference capabilities and narrow its competitive gap with industry leader Nvidia.

A notable complexity in the negotiations is the leadership overlap. Intel’s CEO, Lip-Bu Tan, who assumed the role earlier this year, also serves as Chairman of SambaNova. While this connection may facilitate discussions, it raises questions regarding corporate governance. Furthermore, SambaNova is concurrently engaging with other potential investors, indicating that a deal with Intel, while likely, is not assured.

The contemplated purchase price of $1.6 billion stands well below SambaNova’s peak valuation of around $5 billion in 2021. This reflects both a broader cooling in AI startup valuations and ongoing sector consolidation.

A Calculated Strategic Gamble

This potential acquisition aligns with CEO Tan’s stated “AI-first” reorientation for Intel. The company is striving to significantly expand its footprint in the AI data center market. Previous acquisitions, such as Habana Labs for about $2 billion in 2019, failed to deliver the anticipated breakthrough against Nvidia’s dominant CUDA ecosystem.

Should investors sell immediately? Or is it worth buying Intel?

SambaNova’s technology focuses more on inference—the execution of trained AI models—rather than on the training phase itself. Intel views this as an area with stronger near-term monetization potential and a faster path to integration within its existing data center business. Market observers largely interpret the potential deal as a technological portfolio enhancement rather than an immediate revenue driver; its primary goal is to fill product gaps, not to purchase short-term, high-margin sales.

Financially, Intel operates in a constrained environment. The company carries roughly $47 billion in debt against approximately $31 billion in cash reserves. An acquisition of this magnitude would be manageable for its balance sheet but represents another component in a broader catch-up strategy whose ultimate success remains unproven.

Market Sentiment and Technical Perspective

The market’s initial reaction has been muted yet constructive. Intel’s share price currently stands at €31.21, marking a slight increase from the previous session. Despite recent volatility, the stock maintains a solid year-to-date gain, suggesting investors are granting the new leadership a degree of credibility while scrutinizing execution.

From a chart analysis perspective, a key technical resistance zone in U.S. trading remains around the $38 to $40 level. Market commentary suggests that a confirmed deal with SambaNova could act as a catalyst to challenge this resistance. Should negotiations falter, technical support near $35 would likely return to focus.

Looking Ahead: Key Milestones and Considerations

Two critical milestones loom in the coming weeks. First is the period leading into January 2026, during which the non-binding term sheet could be converted into a definitive purchase agreement. Second is the possibility of regulatory antitrust scrutiny, as AI chips are considered strategically sensitive—even though the $1.6 billion deal size falls well below the threshold of traditional mega-mergers.

Analyst opinions remain divided. One camp views the potential acquisition as a relatively inexpensive way to acquire a key technology building block, repositioning Intel for the AI era. Others, including experts cited by Forbes, point to the company’s mixed track record with past acquisitions and maintain cautious ratings such as “Sell” or “Hold.” The decisive factor will be whether Intel can integrate SambaNova’s technology to drive visible growth and competitiveness, rather than simply adding another entry to a long list of acquisitions.