When Intel needed help, it didn’t come from a new chip architecture or a big jump in technology. Instead, it originated from a stressful time in politics that could have gone very badly. To stay in the semiconductor race today, a business that used to be known for its technological dominance in the US needed more than just great engineering. It took convincing, timing, and a lot of knowledge about power. Lip-Bu Tan, the CEO of Intel, learnt this the hard way and then made one of the most important decisions of his career.
Before the sun came up in Silicon Valley, a social media post from U.S. President Donald Trump shocked Intel’s officials. Trump said at 4:39 a.m. Pacific Time on August 7, “The CEO of INTEL is very CONFLICTED and must resign right away.” Tan’s record as an investor in Chinese firms was the focus of the claim, which suddenly made him the center of a national security discussion. Tan hadn’t met Trump yet, even though other IT CEOs often went to see the president.
Politics has never been a part of Tan’s leadership style. He had spent decades working in venture capital, boardrooms, and negotiating deals around the world, not on campaign trails. For more than twenty years, he hadn’t given money to a presidential campaign. Even after he became Intel’s CEO in March, he was careful about how much he interacted with Washington. Intel left a key government affairs position empty for months after the previous head quit, even though he talked to a few people, including Commerce Secretary Howard Lutnick. For Tan, politics was not important.
That all changed quickly when Trump attacked publicly. People who know about the situation say that Intel quickly worked to set up a meeting with the president. There was no doubt about how urgent it was. Within days, Tan was getting ready for what would turn out to be a 40-minute conversation that changed how people thought about Intel’s future and how it was seen in Washington.
The contents of that meeting, which had not been made public before, show a shocking change. A CEO who was accused of having conflicting loyalties got the U.S. government to promise to spend billions of dollars in Intel in exchange for almost 10% of the company’s stock. The deal made Intel “too strategic to fail,” which meant that the government saw the corporation as important to the country’s interests.
For Intel, the effects were quick and quite important. The government’s support did more than just keep the money stable. It delivered a clear message to both potential partners and competitors that Intel now had the full support of U.S. industrial policy. That support is important in a time when people are more and more looking at semiconductor supply chains through the prism of national security.
The market moved quickly. Intel’s stock price has gone up almost 80% since Tan took over. This is more than the S&P 500 and even Nvidia, which is the current star of the AI chip boom. Investors not only put money into the company, but they also moved Intel to the center of America’s tech agenda.
But there are still uncertainties behind the scenes. Reuters talked to over 20 current and former Intel workers, government officials, and people in the business. Many people agreed that Tan is a good negotiator and relationship builder, but they weren’t sure if he had the technical skills needed to bring Intel back to the top of the manufacturing industry. It didn’t happen overnight that Intel lost its dominance. Years of mistakes inside the company let competitors like Taiwan Semiconductor Manufacturing Company get ahead in making advanced chips.
The problem is especially bad in the field of artificial intelligence. While competitors are racing ahead with specialized AI gear, Intel has had a hard time coming up with a clear, winning plan. Sources say that Nvidia recently evaluated Intel’s breakthrough 18A manufacturing process but decided not to go further with it. For detractors, this brought up difficult concerns about whether political backing can make up for a lack of technology.
Intel, on the other hand, doesn’t agree that Tan is not trustworthy or dedicated. A corporate representative stated in a statement that Tan did not need to be convinced to work with the Trump administration. He made government affairs report directly to him early on in his term, which showed how important it was to the strategy. Intel said in December that a Trump economic adviser would be in charge of the operation. This was seen as a way to strengthen ties with the White House.
The spokeswoman said, “Lip-Bu Tan has been involved in Washington for a long time, both before and after joining Intel.” Intel said Tan would not be available for an interview.
The White House also talked about the arrangement in strategic terms. A spokeswoman said that President Trump was mostly concerned with getting good deals for taxpayers while keeping the country safe. “The Administration’s historic deal with Intel is just one of many steps to bring semiconductor and other important manufacturing back to the United States,” the official stated.
This framing shows a bigger change in U.S. economic policy. It used to be unusual, and even contentious, for the government to own shares in private enterprises. Intel’s transaction shows that these kinds of actions may become more widespread in areas that are seen as important. For some investors, this marks a new era in American industrial strategy, where state power works with market forces to make the economy more resilient.
Intel’s narrative is also a lesson that leaders today need to be able to adapt. Tan has worked in many different places, cultures, and capital markets. That worldwide background, which was originally seen as a negative, became a strength when he had to be sensitive about political sensitivities. The same qualities that let him do deals in Asia and Silicon Valley also worked in the Oval Office.
Even so, government support isn’t enough; you have to do it. Intel needs to keep its promises about manufacturing, win back the trust of its partners, and show that it can compete in the AI-driven future of computing. Political connections can help you get things done, but they can’t design semiconductors or fix production delays.
