Intel Returns to Profit Amid U.S. Government Investment and Restructuring

Intel Posts Profit as U.S. Takes Stake in Struggling Chipmaker

Intel Corp. has reported a return to profitability, marking its first quarterly gain since the U.S. government became one of its major shareholders. The turnaround comes as the company undergoes deep restructuring under new leadership to reclaim its position in the fiercely competitive global semiconductor market.

Intel’s Financial Recovery

In its latest quarterly results, Intel announced a net income of $4.1 billion, or 90 cents per share, for the three months ending in September. That marks a sharp reversal from the $17 billion loss the company recorded a year earlier.

Revenue rose 3% year over year to $13.7 billion, signaling modest growth after several challenging quarters. The company’s stock jumped nearly 8% in after-hours trading, reaching $41.10, extending gains since the U.S. government’s high-profile investment earlier this year.

Government Investment and Strategic Overhaul

Intel’s rebound follows a major shift in both leadership and financial structure. In August, President Donald Trump announced that the U.S. government would acquire a 10% stake in Intel as part of an effort to secure the domestic semiconductor supply chain — a move viewed as vital to national security and economic resilience.

The stake was issued in exchange for nearly $9 billion in funds Intel had already been granted under the CHIPS and Science Act of 2022, legislation designed to revive U.S. semiconductor manufacturing and reduce reliance on Asian suppliers.

While such direct government investment in a private corporation is rare, especially under a Republican administration, the measure reflects Washington’s growing concern over the dominance of foreign chipmakers and China’s technological rise.

Restructuring Under New Leadership

Since taking over as CEO earlier this year, Lip-Bu Tan has undertaken a sweeping cost-cutting campaign, eliminating thousands of jobs and shelving underperforming projects to restore Intel’s financial health.

Tan, a veteran of the semiconductor industry, has emphasized streamlining operations and redirecting resources toward core chip design and manufacturing capabilities. The company’s strategy also includes renewed focus on AI chip development and next-generation fabrication facilities in the U.S. and Europe.

Intel’s turnaround strategy comes amid intensifying competition from Nvidia, AMD, and TSMC, all of which have surged ahead in high-performance and artificial intelligence chip production.

Industry Partnerships and Funding Boosts

In addition to U.S. government support, Intel has attracted new private investment to stabilize its finances. The company received $5 billion from Nvidia in September and another $2 billion from Japan’s SoftBank earlier this year. These partnerships, analysts say, may help Intel accelerate its transition into new technologies and strengthen its supply chain partnerships.

Founded in 1968, Intel was once the undisputed leader of the personal computing era. But the company’s dominance began to erode after it missed the mobile revolution that followed Apple’s launch of the iPhone in 2007.

Now, with artificial intelligence transforming the technology landscape, Intel faces its greatest challenge yet — catching up in a sector where Nvidia’s graphics processing units (GPUs) have become indispensable for AI training and data centers.

Looking Ahead

Analysts view Intel’s latest results as an encouraging sign but caution that recovery remains fragile. The company must still demonstrate consistent growth and technological innovation to regain investor confidence and market share.

The U.S. government’s ownership stake adds both opportunity and scrutiny, tying Intel’s performance to broader national policy goals in advanced manufacturing and technology independence.

For now, investors appear optimistic. As Intel works to rebuild its competitive edge in the AI-driven semiconductor era, its return to profitability marks an early milestone in a long-term comeback effort.

Source: AP News – Intel posts profit even as it struggles to regain market share