President Trump has made history by announcing support for Intel's first 'sub-2nm' chip, marking a significant achievement for Team Blue, whose foundry division was struggling a few quarters ago.
Intel's CEO Lip-Bu Tan Saw Concerning Economic & Political Conflicts Following His Arrival
Time is the best healer, and in the case of Intel, this has played out more prominently than anyone could've imagined. Just a few months ago, President Trump called out Intel's new CEO, Lip-Bu Tan, as a 'conflicted' individual, demanding that he step down from his position, and this stance was driven by the fact that Tan's investment firm had held shares across several Chinese companies. This move brought immense pressure on the new CEO, who also faced resistance from board members. However, fast forward a few months, and now President Trump is congratulating Intel on 18A volume manufacturing, crediting it to a "policy masterstroke."
President Trump recently posted a message on Truth Social, where he appreciated Intel's Panther Lake launch, built on America's most advanced process, the 18A. More importantly, he specifically mentioned Intel's CEO, Lip-Bu Tan, after having a successful meeting with him, indicating that the relations between the USG and Team Blue are now evolving on a much larger scale. We'll delve into the historical timeline of the change in stance later on, but it appears that, for now, Intel's efforts are viewed as the ones that will bring advanced manufacturing back to the US.
When the Trump administration initially called out Intel's CEO Lip-Bu Tan following Senator Tom Cotton's warnings, Intel was in a difficult situation, both economically and politically. Tan had taken over a company with a sluggish foundry division, plagued by internal rifts over how the chip business should be managed. And to top it off, reports linking CEO Lip-Bu Tan to Chinese investments had further tarnished Intel's new administration's image, and it was predicted that Team Blue would face a difficult time ahead.
Lip-Bu Tan managed to deal with the situation by contacting Commerce Secretary Howard Lutnick directly. Since the US administration had been involved with Intel under the CHIPS Act program, the Commerce Department was well aware of the company's efforts toward advanced chip manufacturing. Lutnick reportedly paved the way for Tan's meeting with President Trump, and the biggest breakthrough factor was the 10% stake in Intel, as it not only allowed the USG to be directly involved in the company's business but also to oversee how the CHIPS Act has played out over the years.
With such policies, not only did Intel's CEO Lip-Bu Tan manage to earn the trust of the US administration in a short time span, but Tan also boosted the company's balance sheet as well, since the 10% stake translates into $8.9 billion investment already pledged under grants, which was seen as a massive achievement by Tan. And more importantly, he also mitigated the risks associated with the CHIPS Act, given that President Trump had opposed the incentives introduced under the Biden era.
Once the US-Intel deal had been signed, President Trump was highly impressed by Team Blue's performance with its financial situation, which further strengthened the government's commitment towards Intel. When you see America's President appreciating Intel's 18A and Panther Lake technology, it certainly does imply that Team Blue is moving in the right direction, not only in terms of investing in American manufacturing, but also leading the race for it alongside TSMC and Samsung Foundry.
President Trump's commitment eventually paved the way for deals with NVIDIA and SoftBank, and reports indicate that firms such as Apple, Qualcomm, Microsoft, and many others are exploring a deal with Team Blue, both for front-end and back-end semiconductors. While we do know that 18A isn't the process for external customers, Intel's upcoming 18A-P and 14A are expected to strengthen the company's position in the global foundry business. And it won't be wrong to say that, amidst geopolitics and finance, CEO Lip-Bu Tan has managed to create a fine line.
About the author: Muhammad Zuhair is a hardware and technology reporter for Wccftech, specializing in the semiconductor industry and the complex interplay between technology, manufacturing, and geopolitics. His coverage focuses on the corporate strategies and technological roadmaps of industry giants like TSMC, NVIDIA, Samsung, and Intel. Zuhair's expertise lies in deconstructing complex topics such as fabrication nodes (e.g., 2nm process), the economic impact of policies like the CHIPS Act, and the strategic development of AI infrastructure from NVIDIA, AMD and Intel.
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