The US government has recorded an unrealized gain of $26.5 billion from its major investment in Intel last year. This significant development is attributed directly to a rapid 22 percent surge in Intel shares following the company’s better-than-expected quarterly report released on Friday. As Intel outperformed earnings and revenue expectations, its stock market value saw a sharp and substantial boost.
Massive US investment in Intel pays off
This strong position results from a major deal executed last August. In accordance with the CHIPS Act initiated during the Trump administration, the US government provided Intel with $8.9 billion in incentives and converted its Secure Enclave fund into 433.3 million Intel shares. Acquired at $20.47 per share, these holdings raised the government’s total ownership in Intel to nearly 9.9 percent. By Friday morning, pre-market trading saw Intel stock near $81.80, pushing the government’s Intel stake close to $35.4 billion in value—a more than threefold return within a short period.
This investment isn’t limited to existing shares. The US government also retains an option to purchase an additional 5 percent stake in Intel at a fixed price of $20 per share. These options already show significant profit potential as a result of Intel’s share price surge.
Intel posts surprising rises in revenue and profit
The dramatic jump in Intel’s share price came after the company posted unexpectedly strong first-quarter results. Compared to the same period last year, Intel’s revenue climbed 7 percent to $13.6 billion—well above analysts’ forecast of $12.4 billion. Earnings per share defied the estimated $0.01 loss, with the company reporting $0.29 in profit.
Intel’s Data Center and Artificial Intelligence division delivered standout results, growing 22 percent year-over-year and hitting $5.1 billion in revenue. Growing demand for Xeon processors, fueled by expanding infrastructure and AI investments, played a major role in this performance.
CEO Lip-Bu Tan emphasized that the evolution toward AI-powered computing is driving increased demand for CPUs, noting that the transition to data processing and intermediary tasks is boosting requirements for high-performance chips.
Outlook for the coming quarters
Looking ahead, Intel’s management has set its revenue forecast for the second quarter in the range of $13.8 billion to $14.8 billion. The company’s strong current momentum is being closely watched, especially in the context of the US government’s substantial shareholding.
