Why the US government is not the savior Intel needs

The Trump administration became an unprecedented and confusing last week when it announced that Intel was said to be taken in 10% equity part through the Joe Biden-era official grant program.

Although it is not clear even if these official grants are converted into equity – even possible – It is for debate – It is even less clear that this step is how Intel will solve the biggest problem, its Walling Foundry business. Even Intel is unforgettable.

Intel Foundry, which creates a custom semiconductor for outside customers, is not fruitful for the company. The Business Department has lost in a potentially big deal like Sonie, According to ReutersAnd it spent significantly more than the company than to bring it.

Intel Foundry has stated the loss of an operating income $ 3.1 billion In the second quarter. From the beginning of the year the company has also given thousands of people a discount Foundry Business Unit is having to hit hard especiallyThe

The difference between how Intel will rotate around him Foundry In August 2024, Lip-Boo was partially responsible for the resignation of the company from the company board. Was to tension Appointed CEO At the spring 2025.

Managing Director of Rosenblat Security, Kevin Cassidy, told TechCrunch that he does not see how Intel’s problems will solve the problem. Intel Foundry does not require money to solve the problems, he said, instead it needs to change its aspect to its customers.

“They did not understand the customer service,” said the Cassidy to sign the Intel Foundreity struggle to sign customers. “They were always internally made, the manufacturing group was king. When you think that you know better, it is hard to be customer service-centric group.”

Intel did not respond to any request for comment.

Riple

Intel recently acknowledged the possible downsides of this agreement Filing a second Post on Monday. The company highlighted the risks carried by its investors and customers – the people of the two groups naturally depend on.

This agreement reduces existing shareholders and reduces their administration’s rights. The Trump administration says it will vote in addition to Intel’s interests, which can help the company move forward in its ideas; But business decisions are actively disputed with an existing investor’s attempt to drum investors’ interest.

“If I am a stockholder I would be disappointed if I was a stockholder.” “Intel has left 430 million shares, and mixed my shares and [they] It was able to buy 20% off. “

Intel also mentioned that it could have a possible impact on his international business. In the last fiscal year, most of the company’s revenue came from outside the United States, the company said.

In the United States -led international trade unrest, outside US agencies now have to jump on whether to work with partially owned by the US government.

Signal

Everyone is doom and not disappointed about recent transactions. Benchmark Company Managing Director and Senior Research Analyst Kodi Actry TechCrunch told TechCrunch that he was not seeing the company’s international customers going away from Intel.

Acry said that the deal is not perfect, but the government’s promise to Intel’s future can give Chipmaker its necessary encouragement – even though it is only a small step on the long road to recover it.

“Intel has shown that it has been fighting for the past decade and may need official intervention for the past decade; a bail is probably very rigid in a term, but the government’s intervention is at least a step towards the lively Intel,” said Actry. “I certainly don’t agree with the fix-allion. It is the least to know that the government supports Intel instead of challenging the leadership of the government is like a month ago.”

Jacks Investment Research stock strategist Andrew Roco agrees that an agreement with the US government may be positive. In an interview before the formal announcement of this agreement, Roko said that it could play Intel a bigger role in the current push for domestic AI skills through initiatives like Open, Softbank and Oracle Stargate initiative And the semiconductor is bringing in manufacturing states.

“The market is going to be so big, the data center and the chip market, even if they get a small piece,” Roco said. “They have a place to succeed. This will be positive you you need to have a horizon for five to ten years.”

Nevertheless, both analysts warned that the deal would not be Intel’s savior. The truth is, for chronic rescue, the Intel needs to look at the inner side.

Although the Trump administration has claimed that it would be a passive investor, which does not mean that its involvement cannot do business for the company, Acry said. Although it is hoped that the stress or energy does not come from, the Cassidy said it could certainly.

Although the government does not need it. In contrast to higher education, corporate America has proved to be more happy in the Trump administration’s goals and policies. There are agencies Their variations, equity and inclusion programs – In spite of hitting yourself in the processThe A spread of American pro-sensitivity has become saturated Advertisement And Company contact Since Donald Trump took over in January.

If the Trump administration asks American companies to buy Intel’s chips and hardware, then companies do not have to make the incision so much to get on the board.

Acrry and Cassidy said that Intel’s original test would not be a contract or even its optics. This will be whether Intel can drum interest for his chipming processor in 14. The tan company said Will not start production in the chipmeting process at 14 Until they secure enough customer interest.

“There is still no guarantee that Intel will be able to return to the market on the top end of the Cassidy.” “Intel has been burning in cash for several years, I don’t know if the formula is more money to buy time to buy time to get back to their top edge.”