U.S. taxpayers are now the largest shareholders in Intel. What comes next isn’t so clear.
The Trump administration announced on Friday that the government had taken a 10% stake in the California-based computer chipmaker, which has fallen behind rivals Nvidia and AMD in the artificial intelligence race. Over the past five years, Intel’s share price has declined more than 50%.
The administration has not provided any details on when or under what circumstances it would sell the Intel shares — or whether it would sell them at all. Nor did it say whether the U.S. would benefit from any dividends, although Intel has not paid out any since last year. The administration does not plan on taking any board seats and has said it will only vote against the company in “limited” circumstances.
While Commerce Secretary Howard Lutnick suggested on Friday that national security was a key motivator for taking the stake, on Monday, Trump focused more on the prospect of financial gains.
“I will make deals like that for our Country all day long,” Trump said in a post on Truth Social. “I love seeing their stock price go up, making the USA RICHER, AND RICHER. More jobs for America!” he added.
Intel’s shares have climbed about 4% since the transaction was announced. Some experts said that while there is a potential upside to the agreement, it represents another norm-shattering expansion of presidential authority by Trump into the business world — and likely not the last.
Already, the Trump administration has taken a “golden share” in Japan’s Nippon Steel as part of a deal granting approval to that company’s bid for U.S. Steel, and giving the government a say in future Nippon transactions. Last month, the Pentagon announced it had purchased $400 million in rare earth miner MP Materials, making it the company’s largest shareholder. The White House is also planning to take a cut of the sales that chipmakers Nvidia and AMD make to China.
Trump told reporters on Monday that he hopes to see “many more” deals like Intel’s, adding that nobody “realizes how great it will be.” Kevin Hassett, director of Trump’s National Economic Council, said similar deals could help form the basis of a sovereign wealth fund, an idea that the administration had earlier floated as a way of giving U.S. taxpayers direct stakes in companies but had yet to fully develop.
“At some point there’ll be more transactions, if not in this industry, in other industries,” Hassett said on CNBC.
The U.S. stake in Intel does not amount to a complete government takeover. While the federal government has assumed total control of private corporations before, such incidents have usually arrived during times of crisis — and not with the direct intention of attempting to play the markets.
“He’s doing all this in a spooky, controversial way,” said Clyde Wayne Marks, a fellow in regulatory studies at the Competitive Enterprise Institute, a libertarian think tank. “Right now there is no crisis.”
President Woodrow Wilson nationalized railroads as well as the telegraph, telephone, radio and wireless stations during World War I. Nearly two decades ago, the government bailed out a host of private firms during the 2008-2009 global financial crisis.
While the bailout involved holding corporate assets on the U.S. government’s books with the goal of returning earnings to taxpayers, there was never any serious intention to own them over the long term. And a Government Accountability Office study concluded in 2023 that the program ultimately came at a net cost of about $31 billion.
The U.S. government has long provided subsidies to private corporations in the form of loans and grants, to varying degrees of success. Two high-profile examples came during the Obama administration, when the Department of Energy provided loans to a solar power company called Solyndra and to electric vehicle maker Tesla. Solyndra ultimately went bankrupt, while today Tesla is worth $1.2 trillion on the stock market.
Some have argued that the U.S. would have benefited from having taken a stake in Tesla. Yet at the time Tesla received the loan, in 2010, beliefs about the free market and the need for limiting the government’s role in it prevailed not just among Republicans, but among Democrats as well, experts say.
“Our system has not typically been built that way — it’s not how free enterprise is typically run,” said Dan Reicher, a former Energy Department official under Presidents Clinton and Obama. “History has proven that the more free-market approach, making the bottom line the bottom line for the companies running these operations, is a smarter way to go.”
The Intel investment comes as the company’s fortunes have sagged. Its manufacturing segment lost $3.2 billion in the second quarter, and in July it said it would lay off 15% of its workforce by year’s end while canceling billions in planned investments and delaying the completion date for a $28 billion chip plant near Columbus, Ohio.
In a securities filing Monday, Intel warned investors of the potential risks involved in the U.S. investment, including that the arrangement may actually limit the company’s ability to secure grants down the road, depending on its future performance. It could also potentially harm international sales and make it subject to additional regulations and restrictions, both at home and abroad, Intel said.
On Monday, Trump was asked whether the Intel investment represented a new way of doing industrial policy.
“Yeah. Sure it is,” Trump said. “I want to try to get as much as I can.”
