The U.S. government has acquired a 10% equity stake in Intel, marking a notable intervention in the corporate sector, as announced by former President Donald Trump and Commerce Secretary Howard Lutnick. This deal arises amid challenges facing the chip manufacturer, which has been navigating financial difficulties.
Lutnick shared the news on social media, expressing gratitude to Intel’s CEO, Lip-Bu Tan, for reaching an agreement that he deemed fair to both the company and the American public. This move follows a prior meeting between Tan and Trump, during which Trump had called for Tan’s resignation due to his associations with Chinese firms. Trump later remarked that the arrangement resulted in a substantial financial contribution to the United States.
While details about the government’s $10 billion investment remain vague, it aligns closely with the funding Intel is expected to receive from the Chips and Science Act, aimed at supporting domestic chip manufacturing. This investment is part of a broader strategy that includes other unique arrangements, such as allowing Nvidia to sell chips to China in exchange for a portion of the sales revenue. Similar concessions have been made with chipmaker AMD and agreements involving the Pentagon.
Despite this federal backing, analysts caution that Intel’s challenges persist, particularly regarding its product development and customer acquisition for new factory operations. Under Tan’s leadership, Intel aims to recover from an annual loss of $18.8 billion for the fiscal year 2024, its first loss in nearly four decades.
The government’s non-voting stake is reportedly designed not to interfere with Intel’s management decisions. Nonetheless, concerns about the implications of such corporate interventions in the market continue to be raised by various observers.
Source: https://www.theguardian.com/technology/2025/aug/22/trump-stake-intel-chips