US Government Acquires 10% Stake in Intel Amid Company’s Struggles and Leadership Scrutiny

President Donald Trump on Friday announced that the United States government has secured a 10 percent stake in semiconductor giant Intel, marking one of the most significant government investments in a private technology company since the 2008 financial crisis.

The stake, amounting to 433.3 million non-voting shares, was acquired through the conversion of $11.1 billion in previously pledged funding and grants, including incentives from the CHIPS and Science Act. The shares were purchased at $20.47 each, well below Friday’s closing price of $24.80, instantly giving the government an estimated paper gain of $1.9 billion.

“The United States of America now fully owns and controls 10 percent of Intel, a Great American Company that has an even more incredible future,” Trump wrote in a post.

The move makes the federal government one of Intel’s largest shareholders at a time when the Santa Clara, California-based company is shedding more than 20,000 jobs as part of its ongoing restructuring. The investment comes despite Trump’s sharp criticism earlier this month of Intel’s CEO, Lip-Bu Tan, whose prior investments in Chinese firms raised concerns among lawmakers. Trump had even called for Tan’s resignation on August 7 before softening his stance after Tan reaffirmed his commitment to the US and met with the president at the White House.

By Friday, Trump shifted tone, praising Tan as a “highly respected” leader. In return, Tan expressed gratitude for the administration’s backing. “We are grateful for the confidence the President and the Administration have placed in Intel, and we look forward to working to advance US technology and manufacturing leadership,” he said.

Intel, once a dominant force in the personal computer era, has lost more than $22 billion since late 2023 and currently holds a market value of about $108 billion — a fraction of Nvidia’s $4.3 trillion valuation. While Intel’s stock price has remained stagnant since Tan’s appointment in March, the company hopes the infusion of government support will bolster its turnaround efforts.

The deal has drawn mixed reactions. Supporters argue it strengthens domestic chip production, a key goal of Trump’s trade and technology agenda, particularly in reducing reliance on overseas manufacturers. Critics, however, warn of excessive government involvement in private enterprise.

Scott Lincicome of the Cato Institute described the move as “a horrendous decision” that could distort competition and pressure companies to favor Intel for political reasons. Nancy Tengler, CEO of Laffer Tengler Investments, echoed concerns, arguing, “I don’t see the benefit to the American taxpayer, nor do I see the benefit, necessarily, to the chip industry.”

The investment evokes comparisons to the 2008 federal bailout of General Motors, when the government briefly held a majority stake in the automaker. This time, however, Washington will have no voting power at Intel and no seat on its board.

Still, the purchase underscores Trump’s broader effort to reshape the global semiconductor landscape. Alongside restrictions on US chip exports to China, the Intel deal highlights his administration’s push to ensure technological leadership remains anchored on American soil.