Intel Stock Soars 6% as U.S. Semiconductor Manufacturing Gains Political Backing
Intel Corp. (NASDAQ: INTC) saw a 6% surge in its stock price on Tuesday following bullish remarks from U.S. Vice President J.D. Vance at an artificial intelligence summit in Paris. Vance emphasized the Trump administration’s commitment to bolstering AI chip manufacturing in the United States, a move that investors see as a potential boost for domestic semiconductor production.
Intel’s Role in U.S. Chip Manufacturing Expansion
As America’s largest semiconductor manufacturer, Intel has been aggressively expanding its chip foundry business, aiming to compete with Taiwan Semiconductor Manufacturing Co. (TSMC) and Samsung. While Intel lacks a major AI chip offering currently, the company is leveraging its manufacturing capabilities to secure key partnerships, including a contract to produce Amazon AWS Tranium chips for AI applications.
Intel also received $8 billion in funding from the U.S. Chips Act under President Joe Biden, helping finance its domestic chipmaking operations. However, with the future of the Chips Act uncertain under a second Trump administration, investors are closely watching political developments that could shape Intel’s future.
Trump Administration’s Potential Impact on Intel and AI Chipmakers
During his speech, Vance reaffirmed the administration’s commitment to keeping AI chip production in the U.S., stating:
“To safeguard America’s advantage, the Trump administration will ensure that the most powerful AI systems are built in the U.S. with American-designed-and-manufactured chips.”
This statement signals a potential policy shift favoring U.S.-based chip production, which could benefit Intel, GlobalFoundries (NASDAQ: GFS), and other domestic chipmakers. Investors speculate that Trump’s policies could ease regulations and reduce costs for building semiconductor plants in the U.S., making it more competitive against TSMC and Samsung.
The Growing Push for U.S.-Made AI Chips
While Nvidia (NASDAQ: NVDA), AMD (NASDAQ: AMD), Broadcom (NASDAQ: AVGO), and Qualcomm (NASDAQ: QCOM) currently rely on TSMC’s advanced chip fabrication, pressure from the administration could encourage these companies to shift some production to Intel and GlobalFoundries.
GlobalFoundries CEO Thomas Caulfield noted on the company’s Q4 earnings call that customers are increasingly seeking alternative manufacturing sources in response to geopolitical concerns and Trump’s latest round of tariffs.
“The importance of supply chain diversification is increasing, and some of our customers are no longer waiting to see how policies unfold,” said Caulfield.
Intel’s Leadership Uncertainty and Strategic Vision
Despite this positive market reaction, Intel is still without a permanent CEO, following Pat Gelsinger’s departure last year. However, Vance’s comments suggest that the Trump administration could be a strong ally in Intel’s push for domestic chip production, potentially easing regulatory barriers that have historically made U.S.-based semiconductor plants expensive and slow to develop.
With growing demand for AI chips and a shifting political landscape, Intel’s resurgence in U.S. semiconductor manufacturing could set the stage for a major transformation in the global chip supply chain.
