Intel is set to produce Microsoft's custom chips.
In a deal said to be worth a whopping $15 billion, the firm is cementing its bid to lead the market, which was part of CEO Pat Gelsinger's road map for 2025.
The chips will use Intel’s 18A process.
Microsoft CEO Satya Nadella said in a statement: “We are in the midst of a very exciting platform shift that will fundamentally transform productivity for every individual organisation and the entire industry."
Their biggest competitor is Taiwan Semiconductor Manufacturing Company (TSMC), which has contracts with Apple, Qualcomm, and AMD.
Since the COVID-19 pandemic, there has been a shortage in chips.
Intel was set to open a $20 billion Ohio chip plant next year, however, that has been delayed until 2026, due to supply issues and lack of grants.
