Intel’s Future At Stake? Trump Administration Considers $10-Billion Government Buy-In
News of the possible stake shook Wall Street, with Intel’s shares slipping 3.8 per cent on Monday.
The Trump administration is reportedly exploring an unusual plan that could make the US government a significant shareholder in Intel. According to a Bloomberg report, officials are considering whether some of the financial assistance given to the chipmaker under the Chips and Science Act should be turned into equity. People familiar with the matter said the proposal includes a potential 10 per cent stake, which at Intel’s current valuation would amount to around $10.5 billion.
Although discussions are ongoing, the report noted that no final decision has been reached. A White House official confirmed that such an option is on the table but added that it is unclear how much backing the proposal has within the administration or whether relevant companies have been formally approached.
Market Reaction and US Fed Ambitions
News of the possible stake shook Wall Street, with Intel’s shares slipping 3.8 per cent on Monday. Federal investment could provide Intel with much-needed support as it struggles to regain its footing in the global semiconductor race. Analysts say government backing might ease pressure on the company’s struggling foundry business, but Intel still faces hurdles, including a weak product roadmap and limited customer interest in its new factories.
President Trump has repeatedly linked semiconductors to national security and has pursued aggressive strategies to reduce US dependence on foreign suppliers. His approach has included pushing for multibillion-dollar tie-ups in critical industries. Previous efforts include what was described as a pay-for-play arrangement with Nvidia and a deal with rare earth producer MP Materials to safeguard access to vital minerals.
Intel’s Leadership Challenges
Intel’s turnaround now rests heavily on the shoulders of CEO Lip-Bu Tan, who took charge just over six months ago. Tan has been tasked with cutting costs, implementing job reductions, and steering the company back to profitability. Trump met with Tan on August 11, highlighting the administration’s direct engagement with the company’s future.
“Federal backing could give Intel more breathing room to revive its loss-making foundry business,” analysts noted, though they cautioned that financial support alone may not fix deeper structural issues.
SoftBank Adds to the Mix
Adding another twist, SoftBank Group Corp. announced on Monday that it plans to buy $2 billion worth of Intel shares. Whether this infusion of investor confidence will bolster Intel’s prospects remains uncertain. The company continues to battle sluggish sales, mounting losses, and persistent challenges to regain its technological leadership.
At a time when semiconductors are at the heart of both economic policy and geopolitical strategy, the Trump administration’s deliberations over Intel underscore how closely Washington is tying industry fortunes to national security priorities.
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