Major Earthquake in the AI Sector! In the Wake of a Powerful Alliance, Where Is the Path Forward?

Breaking NewsOh friends,NVIDIA has unexpectedly announced a plan to acquire Intel equity with an investment of $5 billion, aiming to strengthen collaboration in PC CPUs and data center CPUs.。

The impact of this is simply enormous. The strategic alliance between these two giants not only allows them to compensate for each other's weaknesses but also leverage greater integrated advantages.：

1. By collaborating with Intel, NVIDIA can compensate for its weaknesses in PC CPUs and data center X86 CPUs while gaining partial access to Intel’s sales channels.

2. Intel itself will take on a role similar to that of an ASIC CPU provider for NVIDIA, enabling it to earn ASIC-related profits and achieve corresponding sales growth. However, its own PC CPU and data center businesses may be further eroded.

As soon as the news broke, $Intel (INTC.US)$it surged over 30% immediately.， $NVIDIA (NVDA.US)$ and remains at this level currently.The stock rose 2% during the trading session.。

Intel's short-term trend after a sharp rise is difficult to predict, but this time,the gains from Call options after the surge are indeed enticing.(I didn’t expect the miracle after Oracle to be repeated so quickly.），A small amount of money can be spent in the session to bet on the trend.INTC 250919 30.00C

However,From a long-term perspective,although the cooperation with NVIDIA shows promising prospects, the current situation indicates thatIntel's products and market share are clearly lagging behind AMD, and achieving this expectation will require a stronger narrative.Therefore, friends who already hold the underlying stock,may consider taking the opportunity to liquidate part of their holdings or purchasing a Put option to hedge against potential downside risks in the stock.INTC 251031 24.00P

As forNVIDIA’s fundamentals remain strong, with an even more compelling product narrative,and a $5 billion investment is, while not insignificant for NVIDIA’s current cash reserves of $56.8 billion,still within an acceptable range.

Therefore,A moderate holding position can be considered., for example,Open a small position in a 3-month bullish call spread.to gain modest returns from long-term upward movement.

Opening Position:

Buy - NVDA 260116 173 Call

Sell - NVDA 260116 178 Call

Opening cost: $247.5

Maximum profit: $250

There is no need for excessive monitoring; holding for the long term with discretion will suffice.

Of course, let’s broaden our perspective, friends. This is not just a minor issue between these two companies; it could significantly impact the entire AI industry:

1. $Advanced Micro Devices (AMD.US)$ : Significant negative impact. The CPU segments for PCs and data centers now face a dual defense challenge.It is best to avoid this stock. For existing holdings, consider purchasing a Put option expiring in three months to hedge the underlying position.

2. $Taiwan Semiconductor (TSM.US)$ : The impact is manageable. First, due to its technological leadership and monopoly over advanced packaging CoWoS capacity, and second, because most of NVIDIA’s orders are outsourced to Taiwan Semiconductor. This makes it worth considering.Consistently sell Put options expiring in three months at the support level below (around 230). My preliminary estimate suggests an annualized return of approximately 13%.

3. $ASML Holding (ASML.US)$ & $Synopsys (SNPS.US)$ ：PositiveIntel is a key customer, with expectations for increased equipment orders. Meanwhile, the collaboration between NVIDIA and Intel on new integrated SoC solutions—combining CPU, GPU, interconnects, and high-bandwidth memory—relies heavily on EDA tools and various IP cores for system design.

There has been so much market activity recently; let’s see if we can take advantage of the opportunity to make some money.~

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