Kristina Roberts
Intel’s shares went up by almost 4% on Friday after news spread that the government might buy a part of the company. This possible move has given hope to many who believe it could help the struggling chipmaker recover and become strong again. The news first appeared in a Bloomberg report, and it comes at a time when Intel has been facing major challenges in the technology world.
The report said that there was a meeting earlier this week between Intel’s new CEO, Lip-Bu Tan, and President Donald Trump. This meeting happened on Monday, just after Trump demanded that Tan resign because of his “highly conflicted” connections with certain Chinese companies. While such demands are unusual, Trump later described the meeting as “very interesting.” This shows that even though there may be disagreements, talks between the company and the government are still ongoing.
President Trump is known for his bold and direct way of dealing with big companies. In the past, he has taken unusual steps to get the government more involved in business matters. For example, there was a case where the Department of Defense became the largest shareholder in MP Materials, a company that produces rare-earth materials that are important for making high-tech devices. Now, it seems he may be considering a similar move with Intel.
According to Bloomberg’s report, Trump’s administration is looking into the possibility of using funds from the CHIPS Act to buy a stake in Intel. This law, which was signed in 2022 by former President Joe Biden, was created to support the semiconductor industry and make sure the country can compete with other nations in making advanced computer chips. Last year, Intel received almost $8 billion under this program. The money was meant to help the company build new factories in places like Ohio and other states. At that time, the company’s former CEO, Pat Gelsinger, believed that expanding these factories would help Intel regain its leadership in chip manufacturing.
However, after Lip-Bu Tan took over as CEO, he changed the plan. Instead of building all the factories quickly, he decided to slow down the construction process in Ohio. His approach is to build based on actual demand for Intel’s services, not just to expand for the sake of growth. Some analysts believe this decision might clash with President Trump’s vision of strengthening manufacturing as quickly as possible.
When Reuters asked Intel and the White House for comments about the possibility of the government buying a stake, neither of them responded right away. This silence has left many wondering how serious these discussions are and what they could mean for the future of Intel.
Experts say that if the government decides to invest in Intel, it could give the company more time to fix its problems. One of Intel’s biggest challenges is its loss-making foundry business, which makes chips for other companies. Financial support from the government could help keep this business alive while Intel works on improving its products and winning back customers.
Matt Britzman, a senior equity analyst at Hargreaves Lansdown, described this possible move as a “game-changer.” He said, “Government support might help shore up confidence, but it doesn’t fix the underlying competitiveness gap in advanced nodes.” His words point to a deeper issue: money alone cannot solve all of Intel’s problems.
Intel used to be a leader in the chip industry, but in recent years, it has fallen behind. Taiwan’s TSMC now leads in advanced chip manufacturing, and Intel has very little presence in the fast-growing AI chip market, which is dominated by Nvidia. Even in other areas like personal computers and data centers, Intel is losing market share to companies like AMD.
Another major problem is that Intel’s newest chip-making process, known as 18A, is facing quality issues. Reuters has reported that only a small number of the chips produced with this process meet the standards that customers require. This means a lot of time and resources are being wasted, and it also means Intel is still partly dependent on TSMC to make some of its in-house designed chips.
Bernstein analysts have raised an important question: “Intel also needs capability; can the government do anything to help here?” They are pointing out that while financial support might keep Intel running, the company also needs the technical skills and a clear roadmap for making competitive products. Without that, no amount of money will be enough to truly fix its problems. In their words, “Without a solid process roadmap the entire exercise would be economically equivalent to simply setting 10s of billions of dollars on fire.”
The possibility of the government buying into Intel is both exciting and risky. On one hand, it would show strong national support for a company that plays a key role in the technology supply chain. Semiconductors are used in almost everything — from smartphones and laptops to cars and military equipment — so having a reliable manufacturer within the country is a matter of national security. On the other hand, if Intel cannot improve its technology and processes, the investment could turn into a very costly mistake.
This story is not just about one company’s financial troubles. It is about the future of technology leadership. Countries like Taiwan, South Korea, and China are investing heavily in chip production, and this nation does not want to be left behind. If the government takes a stake in Intel, it would be a sign that leaders are willing to step in and directly support key industries when needed.
For Intel, the road ahead will not be easy. Even with government backing, the company must solve its manufacturing issues, regain customer trust, and catch up in markets where it is already far behind. That means improving quality, speeding up innovation, and making sure it can compete with the likes of TSMC, Nvidia, and AMD.
Whether this potential government investment will actually happen remains to be seen. But one thing is clear — the future of Intel is at a turning point. Decisions made in the coming months could decide whether the company regains its place among the leaders of the global chip industry or continues to struggle in a highly competitive market.
