US Commerce Department Considers Equity Stakes in Intel and Other Chipmakers in 2025

• Why Is the US Government Eyeing Equity in Chipmakers?
• How Does This Compare to Past Government-Industry Deals?
• What’s Driving the Equity Stake Strategy?
• How Are Global Chipmakers Reacting?
• What’s the Historical Context for This Move?
• Could This Redefine Industrial Policy?
• What’s Next for the CHIPS Act Funding?
• FAQ: Your Burning Questions Answered

The U.S. Commerce Department is exploring a groundbreaking MOVE to take equity stakes in Intel and other semiconductor companies under the CHIPS Act, signaling a shift from grants to investments. This strategy, backed by Commerce Secretary Howard Lutnick and former President Donald Trump, aims to secure taxpayer returns while boosting domestic chip production. However, the plan faces scrutiny from foreign governments and industry players wary of political risks. Here’s a deep dive into the implications, reactions, and historical context of this bold policy pivot.

Why Is the US Government Eyeing Equity in Chipmakers?

In a departure from traditional grant-based funding, the Commerce Department is negotiating equity stakes in Intel and other semiconductor firms as part of the CHIPS Act disbursements. According to sources familiar with the matter, Secretary Howard Lutnick has championed this approach, framing it as a way to ensure "the American taxpayer gets a piece of the action." The move aligns with the TRUMP administration’s broader push to revitalize U.S. manufacturing—a policy that’s now gaining traction under the current White House. Intel could see the U.S. government acquiring a 10% stake, with similar terms extended to TSMC, Samsung, and Micron.

How Does This Compare to Past Government-Industry Deals?

This isn’t Washington’s first rodeo with unconventional corporate arrangements. Remember when Nvidia struck a deal to sell AI chips to China while handing over 15% of sales revenue to the U.S.? Or when the Pentagon became the largest shareholder in a rare-earth mining firm? Critics argue these deals blur the line between public policy and corporate risk, but proponents like Lutnick counter that equity stakes are smarter than "giving money away for free," as he put it in a CNBC interview. The $52.7 billion CHIPS Act fund—much of which remains unspent—could now become a vehicle for government-backed investments rather than outright subsidies.

What’s Driving the Equity Stake Strategy?

Two words: accountability and returns. WHITE House Press Secretary Karoline Leavitt summarized the rationale: "The president wants to put America’s needs first, both from a national security and economic perspective." By taking equity, the government hedges against project failures while potentially profiting from successes. It’s a page from the venture capital playbook—one that Lutnick openly admitted was inspired by Trump’s criticism of the Biden-era "free money" approach. But let’s be real: it’s also a clever way to offset the political backlash over massive corporate subsidies.

How Are Global Chipmakers Reacting?

Not everyone’s cheering. South Korean officials were caught off guard, with presidential advisor Kim Yong-beom stressing that Samsung needs "predictability" for its U.S. investments. A Korean industry insider warned that equity demands might force firms to reconsider projects unless sweeteners like larger grants are added. Meanwhile, Taiwan’s Economy Minister Kuo Jyh-huei confirmed discussions with TSMC—a tricky situation given the company’s private ownership structure. The irony? These same companies once lobbied hard for CHIPS Act funding. Now they’re facing strings attached that could reshape global supply chains.

What’s the Historical Context for This Move?

Rewind to 2024: The CHIPS Act was hailed as a lifeline for America’s semiconductor industry, with Biden officials doling out grants to lure factories stateside. Fast-forward to 2025, and the script has flipped. Trump’s long-standing skepticism of "handouts" (he once vowed to scrap the CHIPS Act entirely) now manifests in Lutnick’s equity push. The timing is notable—SoftBank’s $2 billion infusion into struggling Intel just days before Lutnick’s announcement suggests private investors see value where the government wants a slice.

Could This Redefine Industrial Policy?

Absolutely. If successful, the equity model might extend beyond chips to clean energy, biotech, and other strategic sectors. Imagine the U.S. government as a shareholder in Tesla-style success stories—or a casualty of Solyndra-like flops. As one Wall Street analyst quipped, "This isn’t your granddad’s industrial policy." But the risks are real: political interference in corporate decisions, market distortions, and the specter of taxpayer losses if bets go south. The Commerce Department’s next moves will test whether state capitalism can work American-style.

What’s Next for the CHIPS Act Funding?

With billions still unallocated, the equity debate is far from settled. Key questions loom: Will Congress greenlight this reinterpretation of the CHIPS Act? How will foreign firms like TSMC navigate geopolitical tensions while accepting U.S. stakes? And can Intel—fresh off SoftBank’s vote of confidence—deliver returns for both private and government shareholders? One thing’s clear: the rules of industrial policy are being rewritten in real time.

FAQ: Your Burning Questions Answered

What percentage stake does the US want in Intel?

The White House has floated a 10% equity stake in Intel as part of CHIPS Act negotiations, per Press Secretary Karoline Leavitt’s statements.

How would equity stakes differ from traditional grants?

Unlike grants (free money), equity stakes give the government ownership shares that could appreciate in value—but also expose taxpayers to losses if investments underperform.

Which other companies might be affected?

TSMC, Samsung, and Micron are reportedly in discussions, though foreign governments weren’t initially consulted about the equity proposal.

Has this approach been used before?

Yes—the Pentagon took equity in a rare-earth mining firm, and Nvidia’s China sales include a 15% revenue share for the U.S., setting precedents for creative deal structures.