Intel is set to be removed from the Dow Jones Industrial Average after a 25-year tenure, with Nvidia taking its place, according to S&P Dow Jones Indices. This shift marks another setback for Intel, once a leader in chipmaking and one of the first tech companies included in the blue-chip index.
In recent years, Intel has lost its manufacturing edge to rivals like TSMC and has struggled to capitalize on the generative AI boom, notably missing out on an opportunity to invest in OpenAI, the creator of ChatGPT. The company’s shares (INTC) have plummeted 54% this year, making it the worst performer in the index and leaving it with the lowest stock price among the price-weighted Dow components. Following the announcement, Intel’s stock dipped about 1% in after-hours trading, while Nvidia (NVDA) gained 1.5%.
Founded in 1968, Intel began by selling memory chips before transitioning to processors that were crucial in launching the personal computer revolution. The iconic “Intel Inside” stickers of the 1990s helped transform basic electronic components into sought-after premium products, becoming a common feature on laptops.
Conversely, Nvidia has solidified its position in the global semiconductor market, driven by the critical role its chips play in generative AI technologies, leading to a remarkable seven-fold increase in its shares over the past two years. This year alone, Nvidia’s stock has more than doubled.
Once primarily favored by gamers seeking high-performance PCs, Nvidia is now the second-most valuable company globally and is seen as a key indicator for the AI market. Its 10-for-one stock split in June also contributed to its addition to the index, making its rapidly climbing shares more accessible to retail investors.