Trump Says U.S. to Take 10% Equity Stake in Intel
The U.S. government will acquire a 10% stake in Intel (NASDAQ: INTC) under a new agreement with the struggling chipmaker, President Donald Trump announced on Friday. The move represents one of the most extraordinary federal interventions in corporate affairs to date.
Intel’s shares jumped more than 6% following the news, though the company declined to comment. The deal marks a sharp reversal only weeks after Trump had called for the resignation of Intel’s new CEO, Lip-Bu Tan, citing what he described as “highly conflicted” business ties with Chinese firms.
The announcement also follows a recent $2 billion investment from SoftBank (TYO:9984), which was seen as a major vote of confidence in Intel’s turnaround efforts. Analysts believe U.S. government backing could provide Intel with critical breathing room as it attempts to revive its loss-making foundry business. However, challenges remain, including a weak product roadmap and difficulties attracting major customers to its new factories.
Trump, who met with Tan on August 11, has pursued an aggressive national security strategy tied to semiconductors and critical minerals. His administration has pushed for large-scale government tie-ups in technology, including discussions with Nvidia (NASDAQ: NVDA) and agreements with rare-earth supplier MP Materials, to secure America’s supply chains.
Lip-Bu Tan, who became Intel’s CEO in March, faces the tough task of leading the company out of its worst financial slump in decades. Intel reported a net loss of $18.8 billion in 2024, its first annual loss since 1986. The company has not generated positive adjusted free cash flow since 2021, highlighting the scale of the turnaround challenge.
