Shares of Nvidia surged on Friday, putting the stock on track for a record closing high as renewed optimism around artificial intelligence demand rippled across the semiconductor sector.
The rally was partly fuelled by strong earnings from Intel, which reassured investors about the durability of demand for advanced computing hardware.
Nvidia’s stock rose 4.8% to $209.18, leading gains on the Dow Jones Industrial Average even as the broader index edged slightly lower.
The shares also touched an intraday high of $210.95, their strongest level since November 2025.
Intel results reignite sector momentum
The immediate catalyst for the rally came from Intel’s latest quarterly results, which pointed to robust demand across key segments tied to artificial intelligence.
The company reported a 22% increase in its data centre business, a closely watched indicator of enterprise and cloud spending on AI infrastructure.
Investors interpreted the results as a positive signal not just for Intel but for the broader chip ecosystem, including Nvidia, which dominates the market for AI accelerators.
The upbeat outlook suggests that demand for high-performance computing hardware remains strong ahead of Nvidia’s own earnings report next month.
Intel’s shares surged sharply following the results, rising about 20% on Friday and heading toward their own record closing high.
The rally extended to other semiconductor stocks, with companies such as AMD, Qualcomm, and Arm Holdings also posting gains of more than 10%.
Interestingly, it was Nvidia that replaced Intel in the Dow Jones Industrial Average in November 2024 following the latter’s underperformance for years.
Since that change, Intel’s shares have risen about 260%, while Nvidia has gained around 50%.
Leadership shift and recovery at Intel
Intel’s turnaround has been closely watched by investors after a turbulent period marked by leadership changes and strategic uncertainty.
At the start of last year, the company faced scrutiny following the departure of former CEO Pat Gelsinger and questions around its foundry ambitions.
The appointment of CEO Lip-Bu Tan has since helped stabilise the business.
Under his leadership, Intel has made progress in executing its manufacturing roadmap, including advances in its 18A process node, and has secured support from industry partners and the US government.
Commentary from Tan during the earnings call further boosted sentiment.
A shift from inference to agentic AI “is significantly increasing the need for Intel’s CPUs and wafer and advanced packaging offerings,” he said, underscoring the expanding scope of AI-driven demand.
Nvidia’s positioning in evolving AI landscape
While Intel and AMD remain dominant in central processing units, Nvidia continues to expand its footprint across data centres and edge computing.
The company has also entered the standalone CPU market, a move that reflects its ambition to capture a larger share of the AI infrastructure stack.
“We never thought we will be selling CPUs standalone, but we are selling a lot of CPUs standalone,” Nvidia CEO Jensen Huang said at the company’s annual conference in March.
“This will for sure be a multi-billion dollar business for us.”
The latest developments suggest that Nvidia is well-positioned to benefit from multiple layers of AI adoption, from training large models to running real-time applications.
Valuation debate and market reaction
Despite its strong performance, Nvidia’s valuation remains a point of debate.
The stock trades at around 41 times earnings, with growth projected at roughly 40% over the next five years.
While some investors see this as justified by its dominant market position, others have expressed concerns about the sustainability of the AI-driven rally.
Earlier this year, fears of a potential AI bubble and stretched valuations led to a pullback in Nvidia’s shares.
However, the latest demand signals appear to have reassured investors.
“Nvidia’s shares are not very volatile and have only had 6 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business,” a report by StockStory said.
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