Intel's 24% Outperformance Over Nvidia: A Tale of Tariffs, Retail Sales, and AI Frenzy in China

In the dynamic world of tech investing, Intel has emerged as a surprising outperformer in 2025, with a 24% lead over Nvidia. This remarkable turn of events can be attributed to a combination of geopolitical factors, market sentiment, and the AI frenzy in China. Let's delve into the key factors contributing to Intel's impressive run.



1. Reciprocal Tariffs and Market Sentiment: President Trump's announcement that he would study reciprocal tariffs, instead of immediately imposing them, caused investors to aggressively buy stocks, including Intel. This shift in timeline was well-received by the market, driving up stock prices. Additionally, weaker retail sales data caused yields to fall and started a bond rally, bringing in more buying into the stock market. This buying was offset as some investors took profits on the market reaching the top band of the resistance zone.
2. Earnings Reports and Mixed Money Flows: Mixed earnings reports from various companies, such as DraftKings Inc (DKNG) and Airbnb Inc (ABNB) reporting better-than-expected earnings, and Applied Materials Inc (AMAT), Palo Alto Networks Inc (PANW), Coinbase Global Inc (COIN), and Moderna Inc (MRNA) reporting earnings less than expected, highlighted the need for proper diversification. In the early trade, money flows were positive in Tesla Inc (TSLA) and NVDA, while they were negative in Amazon.com, Inc. (AMZN), Microsoft Corp (MSFT), Alphabet Inc Class C (GOOG), Meta Platforms Inc (META), and AAPL. This mixed money flow contributed to Intel's outperformance.
3. AI Frenzy in China: The AI frenzy in China has significantly impacted the global tech landscape, with Chinese domestic artificial intelligence companies gaining momentum and upbeat sentiment in the A-share market. This surge has been driven by the success of DeepSeek, a Hangzhou-based startup that launched its newest AI model in late January 2025. DeepSeek's AI Assistant app quickly topped global download charts, surpassing ChatGPT, and has since attracted over 22 million daily active users. This rapid rise has catapulted DeepSeek's founder, Liang Wenfeng, into the ranks of national heroes. The success of DeepSeek has also led to a wave of Chinese tech companies, including Huawei, Moore Threads, Enflame, Baidu's Kunlunxin, and Hygon Information Technology, announcing support for the firm and running the AI model on their own computing chips. Additionally, major cloud providers like Alibaba, Tencent, Baidu, and Bytedance have made DeepSeek's service available through their cloud platforms. This AI frenzy has contributed to the bullish performance of the A-share market and has likely influenced Intel's stock price positively.

In conclusion, Intel's 24% outperformance over Nvidia in 2025 can be attributed to a combination of geopolitical factors, market sentiment, and the AI frenzy in China. While geopolitical risks, particularly U.S. tariffs and global trade policies, pose challenges to both Intel and Nvidia, the AI frenzy in China has created new opportunities for tech companies to capitalize on the growing demand for AI products and services. As investors, it is essential to stay informed about these trends and adapt our portfolios accordingly to maximize returns in this ever-evolving market landscape.