Intel Stock Soars 7% Amid Potential U.S. Government Equity Stake
Intel Corporation’s stock experienced a significant 7% surge on Thursday. This comes in the wake of reports suggesting that the Trump administration is contemplating a direct equity stake in the beleaguered chipmaker. This unprecedented move aims to strengthen domestic semiconductor manufacturing. Moreover, it would provide the necessary funding for Intel’s delayed $20 billion manufacturing facilities in Ohio, thus positioning the company as a pivotal part of America’s chip production strategy.
As per Bloomberg reports, the discussions gained traction post a White House meeting between President Trump and Intel CEO Lip-Bu Tan on Monday. This potential government investment would represent a rare instance of direct federal ownership in a private tech firm. It signifies the administration’s shift towards state capitalism in critical industries. Notably, Intel stands as the only U.S. company capable of manufacturing the most sophisticated semiconductors on American soil.
Intel, the chipmaker, has already secured substantial support through the CHIPS Act. This includes $7.9 billion in direct funding and up to $3 billion for Pentagon programs. However, Intel’s foundry business has struggled to secure major customers amidst intense competition in the artificial intelligence chips sector. Analyst Gil Luria deemed government intervention as “essential” for national security. He stated, “Intel has had many opportunities over decades to get it right, and it hasn’t.”
Source: CNBC