An Intel sign is shown at the chipmaker’s global headquarters in Santa Clara, Calif. on Friday, Aug. 8, 2025.
President Donald Trump has turned $11.1 billion in U.S. government funds into a 10% stake in Intel. The move makes America one of the largest shareholders in the struggling chip giant. The deal comes after weeks of criticism of Intel’s leadership and growing concerns about national security ties.
Trump confirmed the deal in a post, calling Intel a “Great American Company with an even more incredible future.”
U.S. Government Becomes a Key Intel Shareholder
Through the conversion of grants and pledges, the government now owns 433.3 million shares of Intel. Each share was priced at $20.47, lower than Friday’s closing price of $24.80. That instantly gave the U.S. government a paper gain of $1.9 billion.
This investment positions the government as a major stakeholder, despite Intel’s struggles with massive layoffs and years of strategic missteps. The Santa Clara-based company is currently cutting more than 20,000 jobs to recover lost ground.
Intel’s CEO Faces Political Pressure
Intel’s CEO, Lip-Bu Tan, has been in office for only five months. Recently, lawmakers raised concerns about his past Chinese investments, questioning his suitability. Trump even demanded his resignation earlier this month.
However, Tan reassured his loyalty to the U.S. in a letter to employees and later met Trump at the White House. Following the meeting, Trump shifted his stance and praised Tan as a “highly respected” leader.
Tan responded with gratitude, stating that Intel is committed to strengthening U.S. technology and manufacturing leadership.
Intel’s Market Struggles Continue
Despite this government backing, Intel’s stock remains far below its historical peak. The company’s shares are still over 60% below their record high of $75 from two decades ago. Today, Intel’s market value is around $108 billion, a fraction of chip leader Nvidia’s $4.3 trillion.
Intel has also reported losses of more than $22 billion since late 2023, underlining the challenges ahead.
Funding Linked to CHIPS and Science Act
Most of the U.S. government’s stake stems from the CHIPS and Science Act, launched under President Joe Biden. The program was designed to boost domestic chip manufacturing and reduce reliance on overseas factories.
Trump’s administration, despite criticizing Biden’s policies, has now turned those pledges into ownership. Commerce Secretary Howard Lutnick explained the move: “America should get the benefit of the bargain.”
In total, $7.8 billion had been pledged to Intel under CHIPS, though only $2.2 billion had been released. Another $3.2 billion is being funneled from a program called “Secure Enclave.”
Critics Warn of Risks
While the government cannot vote its Intel shares or sit on the board, critics see the deal as risky. Some warn that companies may feel pressured to buy Intel chips to gain favor with Trump. Others fear this could distort competition in the tech sector.
Scott Lincicome of the Cato Institute called the move “a horrendous decision” with long-term harm to U.S. technology and economic leadership.
Investor Nancy Tengler also voiced concerns, arguing the private sector should handle Intel’s recovery, not the government. She warned that political involvement could complicate the company’s turnaround.
Historical Precedent and Strategic Goals
This is not the first time the U.S. government has taken a large stake in a major company. During the 2008 financial crisis, it acquired a 60% share in General Motors but eventually sold at a $10 billion loss.
Trump’s Intel stake aligns with his broader agenda of reshoring production and reducing dependence on foreign-made chips. With global competition in artificial intelligence heating up, the president believes America must secure its chip supply.
Already, the administration is pressuring Nvidia and AMD to pay commissions on chip exports to China in exchange for licenses. The Intel deal adds another layer to Trump’s aggressive strategy in the tech sector.
Trump’s $11.1 billion bet on Intel marks a turning point in U.S. government involvement in the chip industry. While the stake gives America leverage in semiconductor manufacturing, critics fear political interference could backfire. The real test will be whether Intel can regain its dominance in an industry now led by Nvidia.
