Intel Corp (INTC  ) shares climbed in early trading on Tuesday, after the company reported a multi-billion-dollar deal with Amazon.com Inc's (AMZN  ) cloud unit and received a U.S. semiconductor grant.

Here are some key analyst takeaways:

BofA Securities On Intel

Analyst Vivek Arya reiterated an Underperform rating and price target of $21.

Intel announced a collaboration with Amazon Web Services (AWS) on a custom AI fabric chip and custom Xeon server CPU chip, as well as a funding of $3 billion for government chips, Arya said in a note.

"AWS win sounds impressive but INTC has already been supplying AWS with CPU for a long time so customization isn't exactly something new, while the AI fabric (networking) win on 18A will probably matter only from CY26," said Arya.

While the company competes against tough Ethernet switch incumbency from companies like Broadcom Inc (AVGO  ), the analyst wrote. Intel's future as "a leading-edge manufacturing entity" depends on its ability to execute on the next-gen 18A manufacturing node," he added.

Northland Capital Markets On Intel

Analyst Gus Richard maintained an Outperform rating and price target of $42.

Intel struck a deal worth $3.5 billion to make chips for the US military, of which it was awarded up to $3 billion for Secure Enclave, Richard said. Intel is the only alternative to Taiwan Semiconductor Mfg. Co. Ltd. (TSM  ) that the U.S. military has for advanced logic chips, as the Department of Defense requires the chips to be manufactured on US soil, he added.

"AWS and Intel announced a co-investment in custom chip designs under a multi-year, multi-billion-dollar framework covering products and wafers from Intel," the analyst wrote. The U.S. government could continue providing more funding to the company, he further stated.

KeyBanc Capital Markets On Intel

Analyst John Vinh reaffirmed a Sector Weight rating on the stock.

Apart from the government funding and AWS deal, Intel announced several updates on its $10 billion cost savings plan, Vinh said. The updates indicated the company will be "more than halfway through the 15K employee RIF target by year-end and will reduce/exit two-thirds of its real estate globally by year-end," he added.

"We're very encouraged by these announcements and credit INTC management for being proactive regarding the initiatives that it controls, which is namely cost," the analyst wrote. Intel said it intends to make IFS an independent subsidiary, which is a good decision, he further stated.

INTC Price Action: Shares of Intel had risen by 6.12% to $22.19 at the time of publication on Tuesday.