Chip Giant Faces Crisis, Big Money Steps In
Over the past two years, Intel has gone from a dominant force in the semiconductor industry to a company in distress. Amid collapsing profits, tech setbacks, and missed opportunities in the AI boom, investors are asking the tough question: Is Intel still worth buying?
Now, two powerful players are stepping in — SoftBank and the U.S. federal government. Their investment moves could mark a turning point not just for Intel, but for the broader U.S. tech sector.
Intel Stock Crashed 60% — Here's Why
Intel's problems are not just about numbers — they’re about losing technological leadership.
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📉 Q2 2025 revenue: $12.9 billion
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🚨 Net loss: $2.9 billion
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💸 Free cash flow: -$1.1 billion
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⚙️ Foundry business loss: $3.2 billion in one quarter
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👥 Global layoffs: Workforce cut to 75,000 employees
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🏭 Delayed projects: Flagship Ohio plant postponed to 2031
In terms of chip manufacturing, Intel is now trailing behind TSMC and Samsung, especially in the sub-5nm process node race. While Intel’s 18A process (equivalent to 1.8nm) is still in development, TSMC’s N2 chips are already in validation with a reported 92% yield.
Even worse, Intel missed the AI revolution. In the booming data center AI chip market, NVIDIA owns 90%, while Intel controls less than 3%.
SoftBank Invests $2B in Intel: Strategic Buy or Risky Bet?
On August 19, Japan’s SoftBank stunned Wall Street by purchasing $2 billion worth of Intel shares at $23 per share, making it the fifth-largest shareholder. CEO Masayoshi Son called it a "strategic move to support American tech and manufacturing leadership."
SoftBank’s move wasn’t just financial — it was political. With Intel’s valuation down and global sentiment cautious, buying at a discount could offer long-term upside if U.S. government support materializes.
Meanwhile, Intel’s CEO Patrick Chen said he’s maintained “close ties” with Masayoshi Son for decades, signaling alignment between leadership and long-term strategy.
White House Plans to Buy 10% of Intel — A First in U.S. Tech
The bigger shock came next.
According to Bloomberg, the White House is in talks to acquire up to 10% of Intel, which would make the U.S. government its largest shareholder. The deal could involve converting $10.9 billion from the CHIPS and Science Act into direct equity.
This would mark the first time in history that the U.S. federal government takes a major ownership stake in a public semiconductor company — a dramatic move that signals just how critical Intel is to national security and industrial policy.
A White House spokesperson declined to confirm specifics but said: “No deal is final until formally announced.”
Government Investment = Safer Bet for Investors?
What does this mean for retail and institutional investors?
Government support offers short-term stability, but it also comes with heavy oversight. According to policy insiders, equity ownership may allow Washington to supervise Intel’s operations, especially those linked to China.
Intel has already been under pressure to scale back its China-related business. Under Trump-era trade policy, tech firms like NVIDIA and AMD must pay a 15% revenue fee on AI chip sales to China and are being pushed to increase U.S. investments in exchange for tariff exemptions.
From an investor’s view, government buy-ins — similar to what we saw during COVID-era airline bailouts — often precede share price recoveries, but also limit strategic flexibility.
Compare This With Other Chip Investments
Intel isn’t the only chipmaker getting government cash:
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🇺🇸 GlobalFoundries: Received $1.5B in CHIPS Act grants
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🇪🇺 ASML: Backed by EU’s own semiconductor subsidies
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🇨🇳 SMIC and Cambricon: Supported by China’s national chip fund
Across the board, semiconductor investing is no longer a free-market game. Policy, not just performance, is setting the rules.
Should You Buy Intel Stock Now?
For long-term investors, here are key factors to watch:
✅ Policy signals: Is the U.S. government fully committed to backing Intel’s foundry model?
✅ Technology validation: Will the 18A process actually reach commercial yield levels in time?
✅ AI market share: Can Intel regain relevance in GPU and data center acceleration?
✅ Factory completion: Will the Ohio site attract anchor clients, or remain delayed?
SoftBank’s early move and the White House’s looming buy-in may offer short-term support, but Intel still has to deliver on the tech side. If it fails to close the gap with TSMC or regain ground in AI, no amount of capital injection will fix the fundamentals.
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Bottom line? Intel is getting a lifeline, but not a free ride. As government money enters the chat, the stakes have never been higher — for the company, for the market, and for your portfolio.