In a stunning move that redefines the relationship between Washington and Wall Street, U.S. President Donald Trump announced on Friday that Intel Corp. has agreed to give the federal government a 10% equity stake in the company. The deal—expected to be formalized at the White House later today—marks an unprecedented step in U.S. industrial policy, sparking both optimism and alarm across financial markets.
A Bold Deal Between Trump and Intel
Speaking from the Oval Office, Trump hailed the agreement as “a great deal for them,” claiming it would revitalize a company he said had “been left behind” in the global chip race. The president revealed that he first floated the idea during a meeting with Intel CEO Lip-Bu Tan earlier this month.
“And I said, You know what? I think the United States should be given 10% of Intel, and he said, ‘I would consider that,’ and I said, ‘Well, I’d like you to do that,’” Trump recounted. Tan is expected to appear at the signing ceremony at the White House on Friday.
The deal is reportedly tied to funding under the Chips and Science Act, with grants being converted into equity—a sharp pivot from traditional government subsidies.
Market Reactions and Investor Concerns
The announcement sent Intel shares soaring, with gains of up to 6.6% on Friday, reflecting investor hopes that the move could stabilize the beleaguered chipmaker. Still, the intervention has unsettled markets, raising questions about the government’s expanding role in private industry.
“This is not something the U.S. has traditionally done outside wartime or systemic crises,” said one analyst, noting the potential risks to both taxpayers and investors. The possibility of taxpayer losses remains high if Intel fails to regain its technological footing, but Trump’s administration insists the upside could be transformative.
A Shift in U.S. Economic Statecraft
Commerce Secretary Howard Lutnick defended the deal earlier this week, telling CNBC that the administration’s strategy is to “get a good return for the American taxpayer instead of just giving grants away.”
The move aligns with Trump’s broader “economic statecraft” strategy, which seeks to leverage government influence to reshape trade ties, secure dominance in critical sectors like semiconductors, and strengthen domestic manufacturing.
This is not the first such intervention. In early August, Trump announced that Nvidia and AMD had agreed to hand over 15% of revenue from sales of AI chips to China. Earlier this year, the White House also secured a “Golden Share” from Nippon Steel Corp., giving the U.S. decision-making power over United States Steel Corp.
Implications for Global Tech Competition
The Intel deal is expected to ripple across the semiconductor industry, with rivals like TSMC and Micron Technology watching closely. A U.S. official clarified that companies already expanding their domestic investments would not be forced into similar equity-sharing arrangements.
Still, critics warn that the move could distort capital flows and undermine confidence in U.S. markets. Others argue that the strategy is essential to counter China’s dominance in chipmaking and ensure U.S. leadership in advanced technologies.
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What Comes Next
The White House has not revealed whether similar deals are being pursued with other tech giants. For now, the Intel announcement underscores Trump’s willingness to break long-standing economic norms in the name of securing America’s technological future.
Whether the bet pays off, or backfires, remains to be seen.
