SoftBank invests $2 billion into Intel, while the White House ponders over potential stake ownership.
In a surprising turn of events, the U.S. government has acquired a 10% stake in Intel Corporation, marking a significant intervention in a major private tech company. This move, part of a broader strategy to secure U.S. control over critical technology sectors, particularly semiconductor manufacturing, was announced in late August 2025.
The rationale behind this decision is to reduce reliance on foreign chipmakers like Taiwan's TSMC, which could be vulnerable to geopolitical risks involving China. This move is seen as a response to ensure domestic dominance in an industry vital for AI and national security.
The acquisition follows a series of events, including a meeting between President Donald Trump and Intel CEO Lip-Bu Tan at the White House. However, the relationship between the two has been strained, with President Trump demanding Tan's resignation over alleged ties to China. In response, Tan penned a letter to employees, defending himself against these allegations.
The government's involvement has had a noticeable impact on Intel's share price. On Tuesday, Intel shares saw a decrease of $1.65, representing a 6.50% drop. However, the following day, the company saw a boost when Intel announced a $2 billion investment from SoftBank, causing shares to rise by 7%.
Despite the recent setbacks, Intel has had a strong year. The company is the biggest beneficiary of the CHIPS and Science Act, receiving $7.86 billion from the Biden administration. This funding is intended to support commercial semiconductor projects in Arizona, New Mexico, Ohio, and Oregon. As a result, Intel shares have gained 25% this year, with some of the advance being attributed to reports of a government investment.
The White House is reportedly considering a potential 10% stake in Intel, following the success of the initial investment. This approach signals a new precedent of increased direct government involvement in strategic industries under the current administration.
In the midst of these developments, it's worth noting that Intel's former CEO, Pat Gelsinger, lost his job in December 2024 due to the company's failure to secure a turnaround. His successor, Lip-Bu Tan, has faced challenges but has also achieved significant milestones, earning praise from President Trump, who called Tan's success an "amazing story."
As the story unfolds, Intel's stock price continues to fluctuate, mirroring the company's journey through this period of significant change. The ticker for Intel is INTC.
[1] Source: Reuters, The Wall Street Journal, and The New York Times.
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