(Reuters) -Shares of Intel surged 4.6% in premarket trading on Friday after Bloomberg News reported that the Trump administration is in talks with the struggling chipmaker for the U.S. government to potentially take a stake in the company.
The reported discussions follow a meeting this week between President Donald Trump and Intel CEO Lip-Bu Tan, days after Trump called for Tan's resignation over alleged China-linked investments.
Intel on Thursday declined to comment on the report.
A potential deal
could highlight the White House's increasingly hands-on approach to securing strategic industries, with analysts saying Intel could benefit from direct federal backing as it tries to revive its loss-making foundry business.
"Greater government participation could push U.S. fabless chipmakers to leverage Intel's facilities," said Angelo Zino, senior equity analyst at CFRA Research.
"But this doesn't change Intel's product outlook. We're still waiting to see if it finds a white knight to lead its external foundry push."
Intel last month warned it may exit chip manufacturing without external customers, and plans to slow construction on its Ohio factories.
Matt Britzman, senior equity analyst at Hargreaves Lansdown, said the move could be a "game-changer" for Intel's domestic ambitions, but warned that execution risks remain. "Government support might help shore up confidence, but it doesn't fix the underlying competitiveness gap in advanced nodes."
The news comes at the end of a volatile week for Intel, with its shares rallying nearly 20% since Monday amid hopes of easing tensions between Tan and Trump.
(Reporting by Alun John in London and Rashika Singh in Bengaluru; Editing by Jan Harvey and Rashmi Aich)
