Intel Corp. shares surged for the second straight day after the troubled chipmaker made a raft of announcements, spurring optimism that a turnaround plan is starting to bear fruit.

The two companies will co-invest in making "fabric chips" that will be built in a new factory under construction outside Columbus, Ohio.

Shares of Intel are surging before the market opens Tuesday after the chipmaker said its foundry business would make some custom artificial intelligence chips for Amazon Web Services as it attempts to reinvigorate its business.

The most significant transformation of Intel in over four decades” includes $10 billion in cost cutting and foundry business spinoff.

EDT, Intel shares were at $21.62, up $0.70 or 3.37 per cent. On Monday, Intel shares had gained 6.4 per cent. The deal provides some respite to Intel's investors as the chipmaker’s shares had fallen nearly 60 per cent this year.

The partnership, which the companies describe as a multi-year, multi-billion-dollar co-investment, comes as Intel continues to build out its $28 billion chip manufacturing complex in New Albany.

Intel shares jumped 7% before the bell on Tuesday, as a chip-making deal with Amazon's cloud business provided a major stamp of approval for its struggling contract manufacturing business. The chipmaker will build custom AI chips for Amazon Web Services (AWS) as part of the multibillion-dollar deal.