If Intel was relying on government subsidies to help stabilize its fluctuating stock price, the U.S. Department of Commerce just leg swept that idea after awarding the semiconductor company just $7.86B in funding.
While $7.68B is nothing to scoff at, Intel was reportedly set to become the biggest recipient of the Biden admin-initiated CHIPS and Science Act with an award of up to $39B and an additional $11B in loans.
However, earlier this week U.S. Secretary of Commerce Gina Raimondo confirmed that Intel will only receive $7.86B of the potential $8.5 it could have gotten, accompanied by the following statement, “The CHIPS for America program will supercharge American technology and innovation and make our country more secure–and Intel is expected to play an important role in the revitalization of the U.S. semiconductor industry. Thanks to the leadership of President Biden and Vice President Harris, our CHIPS award is catalyzing Intel to make one of the largest investments in semiconductor manufacturing in U.S. history.”
Intel has been in a bit of a tailspin as of late with the company missing deadlines, under performing in the market and getting hit with several chip reliability complaints. While the US government was reported to be mulling over their financial investment with Intel based on the past few shaky years, it seems that its reduction in total CHIPS Act money was due to Intel’s September payout from the Secure Enclave Program.
It would seem that Congress is counting that additional Secure Enclave Program’s $3B as part of the CHIPS Act allotment as well despite it being appropriated for different means.
So far Intel has mustered roughly $11B in subsidies when combining its prior September installment from the US-backed defense and intelligence Secure Enclave Program contract and the recent CHIPS Act payment. Intel plans to pair these allotments with its earned 25 percent investment tax credit to pay on its $100 investment plan in US-based chip manufacturing and buildings over the next few years.
If everything goes to plan, Intel believes the investment could produce over 10,000 Intel-based jobs, as well as facilitating 20,00 construction jobs and another 50,000 miscellaneous but tangentially related jobs.
