 "(File) Intel CEO Lip-Bu Tan. AP")
The Trump administration was reportedly exploring the possibility of taking a financial stake in Intel Corp., a move that could both advance President Donald Trump’s domestic manufacturing goals and reduce political tensions surrounding the company’s chief executive, Lip-Bu Tan.
According to sources cited by The Wall Street Journal, people familiar with the matter indicated that these discussions were still at an early stage and might ultimately collapse. The president raised the idea during a Monday meeting at the White House with Tan. Commerce Secretary Howard Lutnick and Treasury Secretary Scott Bessent were also present. The meeting reportedly followed several days of heightened scrutiny over Intel’s links to China, amid a broader US push to secure control over critical semiconductor manufacturing.
Bloomberg was the first to report on the talks. Following the news, Intel’s shares closed the day up more than 7 percent, with further gains in after-hours trading, The Wall Street Journal reported.
From criticism to courting
The overture toward Intel marked a sharp shift in tone from the previous week, when Trump publicly called for Tan’s immediate resignation. Writing on his Truth Social platform, the president had accused the CEO of being “highly conflicted,” citing his investments in Chinese technology firms. Those comments followed a letter from Republican Senator Tom Cotton questioning whether Tan had divested from companies linked to the Chinese Communist Party and the People’s Liberation Army.
Despite the earlier criticism, Trump struck a conciliatory note after their White House meeting, reportedly praising Tan’s career and success story. The president also suggested that the Intel chief would meet with Cabinet members and return with proposals within a week. This apparent reversal hinted at the administration’s willingness to work with Tan, even while concerns over his past business ties lingered, The Wall Street Journal said.
Strategic significance of Intel
The Trump administration have reportedly identified Intel as the domestic company best positioned to challenge Taiwan Semiconductor Manufacturing Co. (TSMC) in the global chip fabrication market. For months, the White House has sought to expand America’s share of semiconductor manufacturing as part of a broader “America First” industrial strategy.
Industry observers told the American business daily that tech firms have been quick to emphasise US investments in order to gain favour with the administration and secure beneficial policy treatment. Jim Secreto, a former Commerce Department official during the Biden administration, was quoted as saying that the Trump team understood the considerable leverage it held over the technology sector.
Impact Shorts
More ShortsIf completed, a government stake in Intel would join a list of unprecedented interventions by Trump in the private sector. In recent months, the administration reportedly struck a deal with Nvidia and Advanced Micro Devices requiring each to pay the government 15 percent of their China sales in exchange for export licenses. Similarly, in Nippon Steel’s takeover of US Steel, the president secured a “golden share,” granting him influence over the company’s operations.
Intel’s current challenges
Even with possible government backing, there are doubts about Intel’s capacity to substantially increase US capital spending, given its current financial and operational difficulties. The company’s losses reportedly widened to $2.9 billion in the second quarter.
Tan, who assumed leadership of Intel in March after serving on its board since 2022, inherited these challenges alongside a wave of restructuring measures. The company has announced layoffs, scaled back its foundry business, cancelled planned manufacturing sites in Germany and Poland and delayed a high-profile facility in Ohio. Speaking to analysts in July, Tan acknowledged that turning the company around would take time and patience, noting that “a lot” needed to be fixed in order to move forward, CNBC reported.
Geopolitical backdrop
The talks between Trump and Intel also unfolded against a shifting geopolitical backdrop. Over the weekend preceding the meeting, Trump announced a 90-day extension on the suspension of tariffs on Chinese imports while trade negotiations continued. He emphasised that all other elements of the agreement with Beijing would remain unchanged.
This broader US–China technology rivalry has put semiconductor policy at the centre of economic and national security discussions.
Market and industry reactions
The market appeared to welcome news of the potential White House–Intel arrangement. Beyond the 7 per cent surge in Intel’s stock price on the day of the report, shares rose an additional 2 per cent in extended trading. Investors reportedly viewed the possibility of government support as a temporary confidence boost, though questions remained about Intel’s long-term strategy.
Looking ahead
While no formal deal has yet been announced, the talks highlight both the fragility of Intel’s current position and the administration’s willingness to wield economic tools to achieve strategic goals. For Tan, a successful arrangement could mean relief from immediate political attacks, a stronger financial footing for Intel’s turnaround efforts and a public signal of confidence from a president who just days earlier had demanded his resignation.
For Trump, securing a stake in Intel would reinforce his message of revitalising US manufacturing, bolster the domestic semiconductor industry and demonstrate his administration’s readiness to reshape corporate governance through direct government involvement. However, it could also spark debates over the proper limits of presidential power in private industry and the risks of politicising critical technology sectors.
Intel, for its part, issued a statement reaffirming its support for the administration’s efforts to strengthen US technology and manufacturing leadership, while declining to comment on what it described as rumours. Whether the discussions produce a concrete agreement or fade amid political and market complexities, the episode highlights the high stakes at the intersection of technology policy, corporate strategy and presidential politics.