Intel pays $1.5 billion to Nvidia in a legal dispute settlement

$1.5 billion will be paid by Intel Corp to Nvidia to license a technology putting an end to a legal dispute between two tech Titans. It was a major victory for Nvidia whose shares climbed up 4 after hours in recognition of the value of its high-end graphics technology to Intel.

Under the terms of the settlement agreement Intel will have the right to use Nvidia's technology in its PC chips as graphics processing becomes increasingly important.

Nvidia in its turn gets to use some of Intel's technology as it works to build its own PC central processors, using architecture licensed from Britain's ARM Holdings.

Many investors had expected a settlement, but it had been unclear how much Intel might pay Nvidia and the $1 billion payment was not built into the value of Nvidia's stock, said Kevin Cassidy, an analyst at Stifel Nicolaus.

"Impressive, it's a big number," said Doug Freedman, an analyst at Gleacher & Company.