• US government is in talks to potentially take a stake in Intel.
• Shares of Intel surged over 7% following the news.
• The plan originates from a meeting between President Trump and Intel CEO Lip-Bu Tan.
• The stake aims to aid Intel's delayed factory plans in Ohio.
• Trump recently called for Tan's resignation amid concerns over his ties to Chinese firms.

The Trump administration is reportedly in discussions with Intel to acquire a stake in the chipmaker. This initiative appears to follow recent tensions, as President Donald Trump had publicly demanded the resignation of Intel CEO Lip-Bu Tan over his investments in Chinese technology firms, some linked to the Chinese military. Shares of Intel jumped by over 7% immediately following the Bloomberg report on this potential deal, indicating increased investor confidence in the company's future as it attempts to recover from steep losses, according to SCMP, Al Jazeera, and BBC.

Details about the size of the stake remain unclear, but analysts suggest that government involvement could provide the much-needed financial support for Intel's struggling operations. Since 2020, Intel's market capitalization has significantly declined from $288 billion to around $104 billion, with its profit margins also halved. The expected funding is crucial as the company aims to strengthen its manufacturing capabilities, particularly at its new facility in Ohio, which has faced repeated construction delays, according to Reuters and Business Insider.

The discussions between Trump and Tan highlight a broader trend of government intervention in the private sector, aimed at securing the US's competitive edge in semiconductor manufacturing. Analysts argue that this move, while beneficial in the short term, may not rectify the deeper structural issues that have afflicted Intel, particularly its lagging behind competitors like Nvidia in AI chip production. Observers suggest that this government stake could signal a new era of partnerships between the government and tech companies, according to SCMP, BBC, and Reuters.

In light of these developments, industry experts view any potential government backing as a "lifeline" for Intel, which has experienced significant difficulties in maintaining its market position. While some critics may question the fairness of such support, the strategic importance of Intel to the US tech landscape, especially in light of the ongoing AI boom, underscores the necessity of this collaboration, according to Al Jazeera and Business Insider.