• The U.S. government is considering taking a 10% stake in Intel to stabilize the struggling chipmaker.
• Any investment would convert grants approved under Biden into equity, without governance control.
• Intel recently recorded an annual loss of $18.8 billion, its first since 1986.

The U.S. Treasury Secretary Scott Bessent stated that any potential investment in Intel Corporation would be aimed at helping the troubled chipmaker stabilize amidst ongoing financial challenges. Commerce Secretary Howard Lutnick confirmed discussions regarding the government's move to take a stake in Intel, suggesting it would be a conversion of existing grants into equity under the Chips and Science Act. This initiative aims to ensure that taxpayers receive value from federal funds allocated during the previous administration in exchange for these grants, according to Reuters and Bangkok Post.

Bessent emphasized that the proposed investment would not dictate how Intel operates, noting, "The stake would be a conversion of the grants and maybe increase the investment into Intel to help stabilize the company for chip production here in the U.S." Furthermore, Lutnick asserted that the arrangement is aimed at obtaining a financial return for the American taxpayer rather than exerting operational control over Intel, as reported by Reuters and Al Jazeera.

Intel has faced substantial difficulties, recently reporting an annual loss of $18.8 billion in 2024, marking the first time it has posted such a loss since 1986. The company's financial turmoil is attributed to several factors, including management challenges and increased competition from rivals. Lutnick criticized the previous administration's subsidy approach, which he described as giving away government funds “for free” without seeking any form of return, according to Reuters and Bangkok Post.

The discussions come alongside SoftBank Group's recent $2 billion investment in Intel. Despite the financial woes, the possibility of a 10% stake taken by the U.S. government is intended to offer a lifeline to a company crucial for domestic chip production, further indicating a shift in how public funding is administered, as stated by Al Jazeera and Reuters.