The Trump administration has been deeply involved in the operations and client development of Intel over the past year, orchestrating a series of significant partnerships by pressuring tech giants like Apple and Nvidia. A report on July 10th details one of the most direct cases of U.S. government intervention in private technology companies in recent years.

The stock price of Intel has surged more than fourfold since CEO Lip Bu Tan assumed his role in March 2025. While the company's business has shown clear improvement, challenges remain severe—its foundry segment has accumulated an operating loss of $10.4 billion over the past four fiscal quarters.

Tariff Talks as Leverage, Apple Pushed Toward Intel

Apple CEO Tim Cook traveled to Washington last summer to lobby, aiming to persuade the Trump administration to abandon plans for a 100% tariff on all semiconductor imports. If implemented, this tariff would directly increase costs for Apple's core products.

Apple ultimately secured an exemption, at the cost of committing to hundreds of billions of dollars in additional U.S. investment. However, according to government officials, during meetings with Cook, former President Trump and Commerce Secretary Howard Lutnick made another request: they hoped Apple would use Intel's wafer fabs to produce some chips.

Subsequently, Trump announced on Truth Social that Apple would begin using chips manufactured by Intel. He wrote, "I decided to help Intel because we need to design and make our chips right here in the USA."

A person familiar with the matter revealed that Apple plans for Intel to manufacture chips for both Mac notebooks and iPhones. The report notes that the connection between the tariff negotiations and the potential Apple-Intel collaboration had not been publicly reported before.

Government Stake Paves Way for Nvidia, SpaceX to Follow

Concurrently with the Apple negotiations, the U.S. government took more direct action—converting $9 billion in federal subsidies into a 10% equity stake in Intel, becoming its largest shareholder.

This move quickly created a demonstration effect.

Last September, Nvidia announced a $5 billion investment in Intel and an agreement to purchase its custom data center chips. Nvidia CEO Jensen Huang called it a "historic" collaboration.

In April of this year, Elon Musk's SpaceX announced that Intel would join its "Terafab" manufacturing initiative to assist in the "large-scale design, manufacturing, and packaging of ultra-high-performance chips."

Japan's SoftBank also invested $2 billion in Intel last August.

These capital injections are significant. Intel executives stated that without the immediate capital from the government's equity conversion, coupled with the investments from Nvidia and SoftBank, the company would have had to drastically cut capital expenditures over the past year.

Commerce Department's Deep Involvement, Monitoring Foundry Progress

The White House's involvement extended beyond brokering deals to the level of daily operations.

It is reported that CEO Lip Bu Tan travels to Washington approximately monthly to meet with Commerce Department officials and holds regular calls with Secretary Lutnick to report on client relationships and business progress.

The Commerce Department's "chip czar," veteran semiconductor investment banker Bill Frauenhofer, is even more involved—he receives quarterly briefings from Intel CFO David Zinsner. His team members regularly meet with Intel executives in Washington and at the company's Santa Clara, California headquarters to track the progress of new manufacturing technologies.

Commerce officials have explicitly stated their desire to see more chip manufacturing remain in the U.S. rather than in Taiwan (China), South Korea, or Japan. They are particularly focused on Intel's foundry business and are pushing Intel to expand advanced packaging capacity at its New Mexico factory.

Both Intel and the government believe advanced packaging is the best entry point for Intel to compete with TSMC. CFO Zinsner said on an earnings call in January that the foundry business could generate billions in revenue from advanced packaging in the near term, stating, "This is even more exciting than I expected."

Lip Bu Tan's Internal Reforms: Cutting Costs, Restructuring, Poaching Talent

Beyond government backing, CEO Lip Bu Tan is driving large-scale internal changes.

Last September, Tan restructured Intel's reporting architecture, establishing a new "Central Engineering Group." He poached top chip engineer Srinivasan Iyengar from Cadence to integrate custom chip design into a unified team.

He also recruited executives en masse from rivals like Samsung and SK Hynix and granted greater authority to engineer Naga Chandrasekaran, who has deep semiconductor technology expertise and has become the most important sales lead for the foundry business.

Regarding capital expenditure strategy, Tan shifted the investment focus from building new wafer fabs to purchasing precision manufacturing equipment to boost capacity for best-selling products like notebook and data center CPUs.

Results are beginning to show. In April, Intel reported a 22% year-over-year increase in quarterly revenue for its data center business, reaching $5.1 billion. Google Cloud also announced a large-volume purchase of Intel Xeon CPUs for AI workloads. Mark Lohmeyer, Vice President of AI and Compute Infrastructure at Google Cloud, stated, "When they listen to our feedback and act on it, that makes us more excited to partner with them."

However, Intel still recorded a net loss of $3.7 billion for that quarter.

How Far Can Government "Anointment" Go?

This government-led industrial support is not without skepticism.

Scott Lincicome, a trade and industrial policy lawyer at the Cato Institute, warned that the White House's forceful intervention in the deal-making decisions of companies like Apple and Nvidia could set a bad precedent, "especially if Intel ultimately fails to fix its foundry business."

He stated bluntly, "Being the government's favorite only works while you're performing. For Mr. Tan, the risk is—once things start going south, politicians have very short time horizons."

Jacob Feldgoise, a senior research analyst at Georgetown University's Center for Security and Emerging Technology, holds a more optimistic view: "From a technology perspective, Intel seems to be gaining more and more credibility and confidence. Every new customer commitment, every new manufacturing process announcement, the signals are getting better and better."

Whether Intel can translate government backing into long-term competitiveness remains the biggest question for the market.