Trump Admin Eyes Equity Stake in Intel via CHIPS Act Funds

The Trump administration is reportedly in the early stages of negotiations to acquire an equity stake in Intel Corporation, using funds allocated under the CHIPS Act. This potential investment would represent a significant shift in U.S. industrial policy, marking the first time the government may directly own a portion of a private semiconductor manufacturer [1]. The move is seen as part of a broader strategy to strengthen domestic chip production and reduce reliance on foreign supply chains [3].

The focus of the deal centers on Intel’s Ohio fabrication plant, a $28 billion project that has experienced delays and cost overruns. The U.S. government is exploring options to convert existing CHIPS Act funding—originally structured as grants or loans—into equity participation [5]. This would give the federal government a financial interest in the company during a period when Intel has struggled with operational challenges, including workforce reductions and project delays [6].

Intel’s stock price has already responded to the news, surging more than 7% following reports of the proposed investment. Further gains followed as market speculation intensified, suggesting investor optimism about potential government-backed financial support [8]. The stock has risen over 15% since March, the same period in which Lip Bu Tan took over as CEO [2].

The discussions between the Trump administration and Intel gained momentum after high-level meetings between administration officials and Tan. Initially critical of Intel’s leadership, Trump reportedly softened his stance following private discussions with Tan, who has a long track record in the tech industry. Tan previously led Cadence Design Systems for twelve years, during which he earned $575 million in stock sales and retained another $500 million stake [7].

Analysts remain cautious. Stacy Rasgon of Bernstein noted that while the market is reacting positively, the firm does not see significant value in increasing exposure to Intel at this time. He described the stock’s movement as “emotional,” with the hope trade on Intel returning as investors look to see if Trump can deliver on his promise to “Make Intel Great Again” [9].

The Ohio factory has become more than just a manufacturing project. It is now a key battleground in the broader political landscape. Trump has historically held strong support in the state, and with the 2026 Senate race approaching, the administration is likely weighing the strategic value of a high-profile investment in the region [2]. The deal could also serve as a model for future government interventions in strategic industries.

At this stage, no final decision has been made, and the structure of the potential equity stake—whether through the conversion of existing grants or a new funding package—remains under negotiation. Officials have not confirmed whether the investment will draw from the original $7.9 billion in CHIPS Act funding for commercial chip production or from a different source [6].

In parallel, earlier discussions about involving Taiwan Semiconductor Manufacturing Company (TSMC) in Intel’s operations were abandoned after TSMC’s CEO, C.C. Wei, declined the proposal. That left the Trump administration without an alternative but to pursue a direct investment approach [3].

While the government’s involvement may provide a much-needed financial boost, it does not necessarily address the underlying operational challenges at Intel. The company’s Ohio factory remains delayed, and the broader semiconductor industry continues to grapple with shifting demand and technological hurdles. Investors are hoping that Trump’s intervention can catalyze a turnaround, but the long-term success of the company will depend on more than just government backing [5].

Sources:

[1] Bloomberg.com, "Trump Administration Eyeing Chips Act Funds for Intel Stake" (https://www.bloomberg.com/news/articles/2025-08-15/trump-administration-eyeing-chips-act-funds-for-intel-stake)

[2] Fortune, "Days after Intel CEO talks Trump called 'highly conflicted,' ..." (https://fortune.com/2025/08/15/intel-trump-white-house-acquisition-stake/)

[3] HPCwire, "White House Considers Intel Investment Following Tan Meeting" (https://www.hpcwire.com/2025/08/15/white-house-considers-intel-investment-following-tan-meeting/)

[5] Techzine, "Update: Trump Administration May Buy Into Intel" (https://www.techzine.eu/news/infrastructure/133812/update-trump-administration-may-buy-into-intel/)

[6] Mitrade, "Trump's Administration is Negotiating a Government Equity" (https://www.mitrade.com/insights/news/live-news/article-3-1044799-20250816)

[8] AOL.com, "Intel's Stock Soars as Trump Eyes Stake" (https://www.aol.com/intel-stock-soars-trump-eyes-153031967.html)

[9] Yahoo Finance, "Days after Intel CEO talks Trump called 'highly conflicted,' ..." (https://uk.finance.yahoo.com/news/days-intel-ceo-talks-trump-172946429.html)