Trump Administration Weighs 10% Intel Stake via CHIPS Act as SoftBank Invests $2B
Less than two weeks after President Donald Trump called for the resignation of Intel CEO Lip-Bu Tan, the executive is now positioned to secure over $12 billion in new funding. The Trump administration is in talks to convert up to $10.9 billion in CHIPS and Science Act grants into a 10% equity stake in Intel, potentially making the federal government the company’s largest shareholder. Commerce Secretary Howard Lutnick confirmed that the administration plans to exchange already committed funds for equity, accelerating support for the struggling chipmaker.
At the same time, Japan’s SoftBank Group announced a surprise $2 billion investment in Intel, purchasing shares at a slight discount. SoftBank’s founder, Masayoshi Son, aims to use Intel’s manufacturing capabilities for his ambitions in AI chip development, including his “Izanagi” project to challenge Nvidia. Prior to this, Son reportedly explored acquiring Intel’s contract chipmaking unit, and the new investment doesn’t rule out future deals.
Intel shares jumped as much as 11% following news of both investments, reflecting investor optimism in a possible turnaround. The company has lagged behind Taiwan Semiconductor and Nvidia in both manufacturing and chip design, missing out on the AI boom. Tan, who briefly faced calls to resign earlier this month, mended ties with Trump after a White House meeting where the president praised his leadership, helping pave the way for renewed support.
Still, challenges remain. Intel has delayed the opening of its massive chip facility in Ohio, a politically significant project for the Trump administration. Tan has focused on cutting costs and delaying large-scale expansions until customers commit to advanced manufacturing, raising concerns among investors about whether Intel can regain its edge in the semiconductor race.
