Intel is receiving a $2 billion capital injection from SoftBank Group, marking a major vote of confidence for the troubled U.S. chipmaker amidst its turnaround efforts.
The equity investment, announced by both companies on Monday, serves as a lifeline for the once-iconic U.S. chipmaker, which has been struggling to compete due to years of management mistakes that left it with virtually no presence in the booming artificial intelligence chip industry.
This move will make SoftBank one of the top-10 shareholders of Intel and will enhance the Japanese tech investor’s ambitious bet on artificial intelligence, which includes the $500 billion Stargate U.S. data center project.
“SoftBank’s investment helps, but it is not what is going to move the dial for Intel,” said Amir Anvarzadeh, Japan equity strategist at Asymmetric Advisors.
“It’s more to maintain this very good relationship he has with Trump,” he added, referring to SoftBank CEO Masayoshi Son.
The deal follows media reports last week that the U.S. government might buy a stake in Intel, following a meeting between new CEO Lip-Bu Tan and President Donald Trump, initiated by the President’s demand for Tan’s resignation over his ties to Chinese firms.
Additionally, it comes as Tokyo pledged a $550 billion investment package into the U.S. last month as part of a trade deal with Washington.
According to a Japanese government source familiar with the negotiations, the Intel investment is not currently part of that package.
A person familiar with the matter told Reuters that SoftBank’s decision to invest in Intel is not connected to Trump. The White House did not immediately respond to a request for comment.
“This strategic investment reflects our belief that advanced semiconductor manufacturing and supply will further expand in the United States, with Intel playing a critical role,” Son said in a statement.
SoftBank will pay $23 per Intel share, a slight discount to Monday’s closing price of $23.66.
The investment will come through a primary issuance of common stock by Intel, representing an equity stake of just under 2%, an Intel spokesperson mentioned, based on the U.S. company’s market capitalization at the close of trading on Monday.
According to LSEG data, the Japanese company would become the sixth-largest investor in Intel.
Following the announcement, SoftBank shares closed down 4% on Tuesday, while Intel surged 5.6% in after-market hours trading.
The Japanese company will only take an equity stake in Intel and will neither seek a board seat nor commit to buying Intel’s chips, the person familiar with the matter said.
Multiple challenges
Intel has faced financial difficulties, recording an annual loss of $18.8 billion in 2024, its first such loss since 1986, as it grapples with multiple challenges.
Its longtime rival AMD has been gaining share in Intel’s mainstay personal computer and server semiconductor markets, while its ambitious and costly plan for a chip contracting business, aiming to rival Taiwan’s TSMC, has not succeeded.
The company is now considering a significant change to its contract chip manufacturing business to secure major customers, Reuters reported last month, which could be an expensive shift from its previous strategies.
“Intel’s dual role as designer and manufacturer/fabricator uniquely positions it as potentially the best platform in the U.S. to compete with TSMC,” said Charu Chanana, chief investment strategist at Saxo.
Earlier on Monday, Bloomberg News reported that the U.S. government is in talks to take a 10% stake in Intel.
SoftBank declined to provide more details on the Intel investment when asked to comment by Reuters.
Tan, a chip industry veteran who also served as a SoftBank board member before resigning in 2022, expressed gratitude to Son for “the confidence he has placed in Intel with this investment.”
The Intel funding is the latest in the Japanese company’s series of substantial investment announcements in 2025, which include committing $30 billion to ChatGPT maker OpenAI and leading the financing for Stargate.
