Intel is on track to receive its $8.5 billion CHIPS Act award by year-end

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This is a welcome change of pace for Intel.

Intel Fab
Intel opened Mod3, a $3 billion expansion to its D1X manufacturing facility in Hillsboro, Oregon, in 2022. Forthcoming CHIPS Act funding will let the company continue expansion. (Image credit: Intel)

Discussions between Intel and Washington D.C. regarding an $8.5 billion CHIPS Act award are at an advanced stage: The company may start receiving direct funds before the end of 2024, sources familiar with the matter tell the Financial Times.

Intel is the biggest recipient of America’s largest semiconductor investment in history. But it faced funding delays as the White House reportedly wanted more information on its plans. The company recently fought financial headwinds due to a $1.6 billion loss in 2Q24.

Progress is underway, even as Intel cuts costs by slashing jobs and putting projects on hold. And with a presidential election this November, the Biden-Harris administration is likely keen to get the largest recipient of one of its headline policies moving forward. This still does not guarantee that Intel will receive its funds before 2025, however.

Officials are also concerned about whether Intel will sell any part of its business, with news that the company is considering cutting assets to stay afloat. There are also rumors that Qualcomm is interested in acquiring some parts of Intel, but sources say that such moves could derail the delicate negotiations. Even so, the company and the Department of Commerce stayed mum on the issue.

The CHIPS Act award will give Intel a much-needed cash boost, especially as the company struggles to stay afloat. In addition to the $8.5 billion in direct investment, the CHIPS Act will include $11 billion in loans and a 25% investment tax credit of up to $100 billion. The company has already received $3 billion in Secure Enclave funding for military chips. With Apollo Global Management Inc., an American asset management firm offering a $5 billion investment, Intel seems ready to turn things around.

These are all good news for Intel, but it’s still not out of the woods. Hopefully, the company could recover sooner rather than later, allowing it to regain its footing as a solid competitor in the semiconductor space.

Jowi Morales
Jowi Morales
Contributing Writer

Jowi Morales is a tech enthusiast with years of experience working in the industry. He’s been writing with several tech publications since 2021, where he’s been interested in tech hardware and consumer electronics.

9 Comments Comment from the forums
  • dalek1234
    I find this very unlikely. This, and other seemingly good news stories about Intel that are popping up recently, are best case a "dream", and worst case down-right "fabrications". Somebody is trying hard to create an image of positive future for Intel, to keep Intel's customers' confidence in Intel so that the customers don't go elsewhere. Someone is desperately countering all the recent negative news, and sites like THG are copy/pasting that BS.

    Picture this, you are Facebook, and you think Intel will implode in a few years, would you buy Intel's products now, not knowing where Intel will be in a few years? No, you wouldn't. You would bet on AMD, for example, instead, because the future is there. So painting a rosy future for Intel by some, is basically like some commie propaganda.
    Reply
  • rluker5
    I expect some of the money to get to Intel before the election. This would be the case regardless of the party in charge. To make that party look like it can do something in the countries interests. This should help offset the losses Intel is taking from building up their foundries. Which account for more than their total losses last quarter.

    Building leading edge fabs is hard because it is so expensive. The chips act was meant to make it easier to do that in the US. It is a shame that it is taking like 3 years for some already allocated checks to go out but better late than never.
    Reply
  • rluker5
    Without manufacturing, what do you expect to have to pay that debt? Taxes on people servicing each other without producing any material goods of value?
    Reply
  • joeer77
    rluker5 said:
    Without manufacturing, what do you expect to have to pay that debt? Taxes on people servicing each other without producing any material goods of value?

    My tax money does not belong to private companies that can afford to pay their CEO millions. It needs to go home with me. When do I get my cut of the Q1 2025 earnings for my part of the 8.5 billion dollar investment at Intel? Oh yeah never. Straight up theft.
    Reply
  • DS426
    rluker5 said:
    ... It is a shame that it is taking like 3 years for some already allocated checks to go out but better late than never.
    Congress just barely managed to fund themselves, once again, and it's a CR (continuing resolution) rather than a proper full-year budget. So yes, not surprising that all of sudden Intel's checks are approved and said to be coming now that the government can operate... until the end of the year.

    I generally don't favor corporate wellfare but semiconductor manufacturing HAS to be an exception, otherwise the U.S. could get into some really deep doo-doo someday when there's so little domestic production. As a reminder, Taiwan, China, and others prop up their semiconductor industry with various benefits, whether tax incentives, subsidies, etc.
    Reply
  • rluker5
    joeer77 said:
    My tax money does not belong to private companies that can afford to pay their CEO millions. It needs to go home with me. When do I get my cut of the Q1 2025 earnings for my part of the 8.5 billion dollar investment at Intel? Oh yeah never. Straight up theft.
    You aren't being charged $750 for a 9700x non 3d version, and you will have the 3d option so that should be worth your $24 share of it.
    Reply
  • vanadiel007
    It's not money what Intel needs. Intel needs a long term plan.
    Reply
  • tamalero
    joeer77 said:
    My tax money does not belong to private companies that can afford to pay their CEO millions. It needs to go home with me. When do I get my cut of the Q1 2025 earnings for my part of the 8.5 billion dollar investment at Intel? Oh yeah never. Straight up theft.
    Welcome to the classic late stage fascist capitalism excuse of "communism is bad when its for the commoner".
    Reply
  • waltc3
    I'm not sure how Intel receiving an $8.5B poverty grant from the US government (that neither AMD nor nVidia are getting) is a "welcome change of pace" for Intel...;) I mean, it's not as if the money comes from Intel's labors and products, is it? I'm kind of miffed by the fact that Intel seems to be getting special treatment over AMD and nVidia, two other American companies. The Biden government seems especially good at throwing gobs of taxpayer dollars at various open-ended causes with no apparent solutions. As far as FABs go, TSMC has a FAB opening here at some point and right now TSMC is way ahead of Intel's FABs technically. The CHIPS Act so far seems very unevenly distributed and unplanned, although I suppose with the current administration so close to an election, that's not a surprise. I will feel much better if and when much smarter, savvy people can manage the government!
    Reply