Intel stock soars 7% as Trump government mulls taking stake; check details of potential deal
This potential deal could mark a significant step in bolstering the US semiconductor manufacturing, aligning with President Donald Trump's push for domestic high-tech production.
Intel is the only US company capable of producing cutting-edge chips domestically, a critical asset in the global race for semiconductor supremacy. Rivals like Taiwan Semiconductor Manufacturing Company and Samsung have US factories, but Intel's unique position makes it a focal point for national security and economic strategies.
The proposed government stake aims to fund Intel's ambitious Ohio factory hub, initially announced in 2022 with a $20 billion investment, potentially scaling to $100 billion. This complex, intended to be the world's largest chip manufacturing facility, has faced delays, with production now pushed into the 2030s.
The deal stems from a recent meeting between Intel CEO Lip-Bu Tan and President Trump on August 11, 2025. Despite earlier tensions, Trump had called for Tan's resignation over alleged ties to Chinese firms; the discussions appear to have shifted toward collaboration.
Intel emphasized its commitment, stating, 'We are deeply committed to supporting President Trump's efforts to strengthen U.S. technology and manufacturing leadership.'
Intel has faced significant challenges, losing 60% of its stock value in 2024. Despite a 19% recovery in 2025, the company struggles to compete in the artificial intelligence chip market, where Nvidia and AMD dominate.
Intel's foundry business, which manufactures chips for other companies, has yet to secure a major customer, a critical step for expansion. The government's investment could provide the financial boost needed to stabilize Intel's operations and accelerate its Ohio project, enhancing its competitiveness.
The potential stake reflects a growing trend of the US government's involvement in strategic industries. Recent moves include a 15% stake of Nvidia and AMD chip sales to China, a $400 million equity stake in MP Materials, and a 'golden share' in the US Steel to facilitate its acquisition by Nippon Steel.
The deal could strengthen Intel's financial position and signal confidence to investors and potential foundry clients.
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