Intel Introduces Videogame Graphics Chips to Challenge Nvidia

Intel’s pitch, Mr. Gelsinger said, would be to gamers tired of paying sky-high prices for the fastest, most advanced graphics chips. “They’ve just gotten super expensive, and we don’t think they need to be. We’re about to fix that,” he said at an annual company conference.

Intel’s cards will start at $329, he said. Nvidia last week unveiled a new generation of graphics processors priced at up to $1,599, although Intel’s aren’t expected to challenge those high-end cards on performance, instead aiming to be price-competitive with older-generation chips.

Intel shares fell around 1% in midday Tuesday trading. Nvidia’s stock was up 0.65%. AMD also traded higher.

The graphics-chip market has grown rapidly in recent years, both due to a surge in videogaming during the pandemic and because those chips have demonstrated to be adept at artificial intelligence calculations that are gaining more widespread adoption.

Nvidia’s sales of videogaming chips were around $2 billion in its latest quarter, while AMD made $1.7 billion in its videogaming segment. The market has cooled in recent months amid economic headwinds and shakiness in consumer spending.

Intel has tried to make graphics processors before, but it has been more than a decade since its last products were under development.

The company has seen its market value slide sharply in recent years. Nvidia is now the largest U.S. chip maker by market value based on its appeal to gamers and the growing AI computation market.

Photos: What Makes Chips So Hard to Produce

Intel began working on graphics processors again several years ago. The first products to emerge from that effort were aimed at large data centers and supercomputers, not consumers. Intel’s high-performance graphics processors are in the Aurora supercomputer at the Argonne National Laboratory in Illinois.

In addition to its new graphics cards, Intel on Tuesday unveiled a new generation of its central processing units for PCs.

Mr. Gelsinger has been trying to revive Intel’s fortunes, including returning the company to make the most cutting edge chips after it lost its manufacturing lead to

Taiwan Semiconductor Manufacturing Co.

and South Korea’s

Samsung Electronics Co.

On Tuesday, he said those efforts were on or ahead of schedule.

Write to Asa Fitch at [email protected]