US Government Eyes 10% Stake in Intel Amid Semiconductor Crisis
Once a flagship firm of the American semiconductor industry, Intel is currently experiencing one of the most serious crises in its history. Not only is the company suffering from financial losses, but it's also laboring under the weight of several technological delays, falling behind both TSMC or Samsung.
And to make matters worse, Intel seems to be having a tough time keeping its industrial promises, especially when it comes to the future mega-factory planned for Ohio.
That facility has suffered from repeated delays, a significant setback at a time when rivals are pulling off stunning successes with major projects and Nvidia stock hitting all-time highs.
This situation worries Washington: in a context where semiconductors have become a significant geopolitical issue, the United States doesn’t want to risk losing a player like Intel. This is why the Trump administration is stepping in with an unparalleled plan.
Strategic Shift: From Subsidies to Direct Investment
It’s not a secret that the White House has been discussing with Intel about converting a portion of the subsidies from the CHIPS Act, which are worth between $8 billion and $10.9 billion, into a direct equity stake.
The operation could give the US government nearly equivalent to 10% of Intel's capital, or about $10 billion worth of shares. This would be a big shift. The move would take Intel from being a company with public support, to one with significant federal influence in its corporate governance.
Beginning in March 2025, Intel found a new leader in Lip-Bu Tan, the former Cadence Design chairman, appointed to revive the company. But Tan's appointment isn't without controversy. CNBC reported that Donald Trump directly asked Tan to resign, citing his past relationships with China as a security risk to national security.
Meanwhile, Tan's strategy, which is concentrated on cutting costs and slashing jobs, prompts concern from analysts. They worry that this strategy might weaken the company's innovative capability.
News of the government equity discussions had an immediate impact, causing Intel's stock to fall 3.7%. Investors seemed to fear the potential for massive dilution — up to 442 million new shares.
The reaction, which is detailed in a Reuters report, illustrates the market's distrust of direct government intervention in a private company, even a strategic one.
SoftBank's Private Support Amid Government Intervention
Simultaneously, the Japanese conglomerate SoftBank revealed a $2 billion investment in Intel, amounting to about 2% of the capital. Founder Masayoshi Son clarified that he intended to support a recovery of the American industry.
This provided a reassuring counterweight to all the market skepticism around Intel’s future. This private investment could help stabilize the situation, while demonstrating that the company still has the confidence of top global investors.
If the White House’s initiative is confirmed, this stake would render the US government the largest shareholder in Intel. The objective is clear: ensure that the production of strategic chips happens in America, reduce reliance on Asia, and secure the nation's technological independence.
This action is part of a broader strategy. Washington has already committed resources, made investments, and secured positions in other essential firms, including Nvidia, AMD, and other major players of the S&P 5businessabc.net00 index.
A Strategic but Risky Gamble
The American government’s involvement in Intel's capital is a historic turning point. It shows that the Trump administration wants to do more than provide subsidies, and instead be a direct player in determining the firm’s fate.
But this choice remains risky:
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For investors, it represents value dilution.
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For Intel, the risk is that political interference could hinder decision-making.
Between massive public support and geopolitical pressure, Intel is now intimately linked to the American technological sovereignty strategy. The company's future seems certain, though its exact trajectory remains unclear.
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