U.S. Gov Eyes Intel Stake for Domestic Chip Boost
The U.S. government is reportedly in advanced discussions to acquire a stake in Intel, a move signaling an unprecedented level of direct intervention aimed at bolstering domestic semiconductor manufacturing. The potential agreement, first reported by Bloomberg and widely corroborated, comes amidst efforts by the Trump administration to solidify the nation’s chip supply chain and support critical projects like Intel’s long-delayed Ohio chip facility.
This significant development follows a high-stakes meeting on August 11, 2025, between Intel CEO Lip-Bu Tan and President Donald Trump and his cabinet members. The meeting itself was notable, occurring just days after President Trump had publicly called for Tan’s resignation, citing alleged past investments in Chinese technology companies with ties to the Chinese military. While the White House, through spokesperson Kush Desai, has maintained that “discussion about hypothetical deals should be regarded as speculation unless officially announced by the administration,” the reports have already sent Intel’s shares surging, reflecting investor optimism for a government-backed lifeline.
The proposed government investment is primarily geared towards accelerating Intel’s ambitious $28 billion manufacturing complex in Ohio. This sprawling facility, once envisioned as the world’s largest chipmaking hub, has faced repeated setbacks, with its operational timeline now pushed back significantly from an initial 2026 target to between 2030 and 2031. These delays underscore the immense financial and logistical challenges in establishing cutting-edge semiconductor fabrication plants.
Intel, under the leadership of Lip-Bu Tan since March 2025, has been navigating a period of considerable difficulty. The company, once the undisputed leader in chip manufacturing, has seen its market value plummet and its profit margins halve in recent years, struggling to compete in the booming AI chip market dominated by rivals like Nvidia. Its foundry division, crucial to its “IDM 2.0” strategy aimed at re-establishing its manufacturing prowess, has remained deeply unprofitable. A direct government stake could inject much-needed capital, alleviating severe cash flow pressures and helping to stabilize the company’s ambitious turnaround plans.
This potential deal is a clear manifestation of the U.S. government’s intensified focus on reshoring semiconductor production, viewing it as a critical national security imperative. While the landmark CHIPS and Science Act, signed in 2022, has already allocated substantial funding—Intel itself received up to $7.86 billion in direct funding and an additional $3 billion for a secure enclave program for defense chips—the reported stake goes beyond traditional subsidies. It signifies a deeper, more direct industrial policy, where the government takes an equity position in a private technology firm. This approach aligns with other recent government interventions, including a deal requiring Nvidia and AMD to pay a percentage of their Chinese AI chip sales to the U.S. government, and a preferred stake in rare earth producer MP Materials.
The discussions highlight the complex interplay between national security, economic competitiveness, and corporate strategy in the high-stakes world of advanced technology. The outcome of these talks could not only reshape Intel’s future but also set a new precedent for government involvement in vital strategic industries within the United States.