Intel Stock Jumps on Report U.S. Government Could Take a Stake in the Company

Intel stock rose 7.4% on Thursday. (Getty Images)

Intel stock jumped after reports the U.S. government is in talks to take a stake in the chip maker.

White House Spokesman Kush Desai said in a statement to Barron’s that “discussion about hypothetical deals should be regarded as speculation unless officially announced by the Administration.”

The Trump administration is in talks with Intel to have the U.S. government potentially take a stake in the company to bolster domestic manufacturing, The Wall Street Journa l reported, citing people familiar with the matter.

In a statement to Barron’s, an Intel spokesperson said: “Intel is deeply committed to supporting President Donald Trump’s efforts to strengthen U.S. technology and manufacturing leadership. We look forward to continuing our work with the Trump administration to advance these shared priorities, but we aren’t going to comment on rumors or speculation.”

Shares of Intel jumped on the report, closing up 7.4% on Thursday to $23.86—their highest close since March 25, according to Dow Jones Market Data. The stock has gained 19% this year.

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Intel shares were 3% higher at $24.57 in premarket trading on Friday.

The report comes after a busy month for the company and its relationship with the president. Trump wrote in a Truth Social post on Aug. 7 that he believed Lip-Bu Tan, the CEO of Intel, “is highly CONFLICTED and must resign, immediately.” That came shortly after Sen. Tom Cotton (R-Ark.) sent a letter to Intel’s board chair that raised questions about Tan’s connections to Chinese firms.

Tan then met with Trump earlier this week. The president posted on social media that “the meeting was a very interesting one.”

“Mr. Tan and my Cabinet members are going to spend time together, and bring suggestions to me during the next week,” Trump added.

Trump has been vocal about wanting large tech companies to manufacture products in the U.S., and tech CEOs are responding. Apple CEO Tim Cook had joined a White House press conference earlier this month, where the iPhone maker’s executive laid out plans to invest $600 billion in the U.S. over the next four years.

Intel is hoping to regain market share in chip manufacturing from Taiwan Semiconductor Manufacturing and ideally needs a major external customer to commit to using its latest processes.

“The greater government participation, aimed at significantly boosting U.S. chip manufacturing, could seek to push and/or encourage U.S. fabless chipmakers to leverage Intel’s U.S. facilities,” wrote CFRA Research analyst Angelo Zino in a research note. “That said, it is hard to get overly excited on the Intel story given this news doesn’t change the chipmaker’s product business prospects.”

Write to Angela Palumbo at angela.palumbo@dowjones.com