U.S. government buys 10% Intel stake through $10 billion equity investment

The U.S. government has secured a 10% stake in Intel, valued at approximately $10 billion, under a newly agreed financial arrangement. This move is part of a broader strategy by the Trump administration to exert greater control and influence over critical U.S. technology firms. The agreement ties into the CHIPS and Science Act, a legislative initiative passed under the Biden administration to incentivize domestic semiconductor production.

According to a statement from Intel, the U.S. government will invest $8.9 billion in Intel common stock. This investment is financed by $5.7 billion in previously awarded CHIPS grants that have not yet been disbursed, as well as $3.2 billion from the Secure Enclave program. This is in addition to the $2.2 billion in CHIPS grants Intel has already received, bringing the total U.S. investment in the company to $11.1 billion [1].

The government’s stake will replace the remaining grant funds that were initially intended to support Intel’s manufacturing expansion across the U.S. This equity arrangement reflects a shift in policy from cash grants to direct ownership, which allows the government a more tangible influence over the company’s strategic direction and performance.

Intel shares surged 5.5% following the announcement, signaling positive investor sentiment. However, critics of the deal remain unconvinced of its long-term benefits. Former leaders of the Commerce Department’s Chips program, writing in the Wall Street Journal, noted that the agreement does not address a key challenge for Intel: attracting foundry customers [1]. The company’s struggle to expand its role in semiconductor manufacturing beyond its own product lines remains a significant hurdle.

The decision marks a broader trend under the Trump administration, which has shown a growing willingness to intervene in major corporate agreements. President Trump has emphasized the importance of such deals, stating that they help secure American economic interests and technological leadership. “We do a lot of deals like that,” he said. “I’ll do more of them.”

This arrangement also raises questions about the balance between government support and corporate independence. While the U.S. government is now a major shareholder in Intel, it remains to be seen how this will affect the company’s operational autonomy and its ability to compete globally.

As the semiconductor industry continues to play a central role in national security and economic competitiveness, such government-corporate partnerships are likely to become more common. Intel’s latest deal sets a precedent for how state and private interests may intersect in the years to come.

Sources:

[1] title: The terms of the U.S. government’s 10% Intel stake

url: https://fortune.com/2025/08/25/the-terms-of-the-u-s-governments-10-intel-stake/