President Donald Trump said on Friday he reached an agreement with Intel CEO Lip-Bu Tan that would involve the struggling chipmaker giving the United States a company stake worth $10 billion, a deal model that Trump said he hopes to revisit with other companies.
“I said, I think you should pay us 10% of your company,” Trump said of his conversations with Tan. “And they said yes.”
Trump said the deal will was a win for both sides.
“I think it’s a great deal for them. And I think it’s a great deal,” Trump said in the Oval Office on Friday. “He walked in wanting to keep his job, and he ended up giving us $10 billion for the United States.”
Two weeks ago, Trump called for Tan’s immediate resignation following reports about his alleged connections to China.
The agreement Trump announced is part of an effort to help boost semiconductor manufacturing in the United States, although it is not immediately clear how involved the Trump administration aims to be in strategic decision-making at the company.
Trump also said he would do more of these types of deals. His administration has been weighing opportunities to take similar stakes in various US companies in critical industries, two people familiar with the White House discussions on the matter told CNN last week.
Intel declined to comment following the Trump announcement. The chipmaker’s stock (INTC) rose 7% on Friday.
After Trump met with Tan at the White House last week, reports emerged that the White House was considering the unusual move of taking an stake in Intel. Earlier this week, Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick confirmed the discussions, saying the deal would likely involve converting grant funding from the Biden-era CHIPS Act into an equity stake.
“America should get the benefit of the bargain,” Lutnick told CNBC.
On Friday following Trump’s announcement, Lutnick posted on X that “The United States of America now owns 10% of Intel, one of our great American technology companies.”
“This historic agreement strengthens US leadership in semiconductors, which will both grow our economy and help secure America’s technological edge,” Lutnick said in the post. “Thanks to Intel CEO (Lip-Bu Tan) for striking a deal that’s fair to Intel and fair to the American People.”
Like his predecessor, former President Joe Biden, Trump has said that increasing domestic production of semiconductors is a national security priority, given their central role in products ranging from cars and iPhones to weapons and medical machinery. Currently, most of the world’s chips are produced in Taiwan, although several major tech companies have been investing in increased chipmaking capacity in the United States in recent years.
Although it was once one of America’s most important tech companies, Intel has fallen behind rivals after failing to anticipate successive technology waves. Tan took over Intel in March and has been attempting to turn around the beleaguered company. Intel said last month that it had mostly completed plans to lay off 15% of its staff as part of Tan’s efforts to right the ship.
Japan’s SoftBank on Monday said it would invest $2 billion into Intel.
Bloomberg reported last week that the White House wants to help Intel follow through on plans to open a new US manufacturing facility in Ohio, which has been repeatedly delayed amid the company’s financial troubles. And Bessent confirmed on CNBC that an Intel stake would be intended to “help stabilize the company for chip production here in the US.”
But it’s not clear how Trump’s investment will help directly solve some of Intel’s core problems, namely that it struggles to attract customers with chip technology that’s less advanced than that of competitors like TSMC.
Bessent indicated that the White House doesn’t plan to pressure other US tech companies to buy Intel’s chips. He added that “the last thing we’re going to do is put pressure, is take the stake and then try to drum up business.”
It’s not the first unusual deal Trump has reached with US semiconductor companies. Chipmakers Nvidia and AMD said earlier this month that they would pay 15% from their chip sales in China to the government in exchange for export licenses, after the White House had previously said selling their products there posed a national security risk.
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