President Donald Trump's administration plans to take a stake in Intel Corp (NASDAQ:INTC) to help the key U.S. chipmaker unlock value. The administration aims to replicate the public-private model that fueled Taiwan Semiconductor Manufacturing Co's (NYSE:TSM) success.
Intel and Taiwan Semiconductor traded higher on Monday, while Taiwan Semiconductor marked an all-time high, spurred by investor optimism amid an exciting earnings season.
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The U.S. looks to Taiwan Semiconductor, the leading chip foundry, as a model, Nikkei Asia reported on Tuesday.
Taiwanese authorities helped establish the company, and a government-linked fund remains its largest shareholder. Intel resisted the U.S. government's stake.
The U.S. chipmaker remains engaged in other activities to boost value.
Intel closed its long-awaited deal to sell a majority stake in Altera to Silver Lake. Signed on April 14, 2025, the $3.3 billion transaction officially closed on Sept. 12, giving Silver Lake 51% ownership while Intel retained 49%.
Intel will include Altera's results through Sept. 11 in its third-quarter 2025 financials, then account for its stake using the equity method. Altera generated $816 million in revenue in the first half of 2025 with a 55% gross margin, and Intel cut its 2025 adjusted operating expense target to $16.8 billion to reflect Altera's deconsolidation, while keeping its 2026 target at $16 billion.
The divestiture coincided with Intel’s sweeping restructuring to manage financial strain. The company reported GAAP operating expenses of $21.9 billion for 2025 and projects $19 billion for 2026.
Intel shares gained over 20% year-to-date, amid reports indicating that the U.S. government has taken a 10% equity stake through the CHIPS Act. Taiwan Semiconductor gained 32% buoyed by the AI frenzy. Washington also secured a warrant to buy an additional 5% at $20 per share if Intel's foundry ownership dips below 51%.
Intel CFO David Zinsner said the government stake aims to preserve the loss-making foundry unit, which logged $3.1 billion in second-quarter losses. New CEO Lip-Bu Tan has begun cutting headcount to 75,000 and setting up a separate board for the foundry, while pursuing a major 14A process customer for 2026.
INTC Price Action: Intel shares were down 0.22% at $24.71 at the time of publication on Tuesday. The stock is trading within its 52-week range of $17.66 to $27.55, according to Benzinga Pro data.
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