With the deal, SoftBank will become one of Intel’s top ten shareholders and add its investors’ ambitious bet on semiconductor and AI assets.
The SoftBank Group has agreed to buy $2 billion worth of Intel shares, a strategy aimed at making a US investment and also helping the struggling chip manufacturer.
This equity investment, revealed by both companies, is a lifeline for the once-iconic US company, which faced challenges in keeping pace with the rapidly growing artificial intelligence (AI) chip market due to years of managerial blunders.
With the deal, SoftBank will become one of Intel’s top ten shareholders and add its investors’ ambitious bet on semiconductor and AI assets, which include the $500 billion Stargate US data center project.
The Japanese company will become the sixth-largest investor in Intel, based on data from the London Stock Exchange Group (LSEG).
SoftBank was previously in talks with Intel about a potential acquisition of its contract chipmaking business, ahead of the investment announcement, according to sources with knowledge of the discussions.
Intel has invested billions of dollars in setting up a contract manufacturing business, but it has struggled to compete effectively with Taiwan Semiconductor Manufacturing Company (TSMC) and has barely attracted external clients.
While SoftBank’s investment in Intel is advantageous for the company, Amir Anvarzadeh from Asymmetric Advisors specifically believes that the size and nature of this equity stake make it unlikely to significantly improve Intel’s competitive position or long-term prospects. He sees limited direct impact from the investment itself.
He mentioned that this move has a motive, namely to foster a good relationship with US President Donald Trump, referring to SoftBank CEO Masayoshi Son.
The deal comes in the wake of news from last week that the US government might buy some shares in Intel, after President Donald Trump met with the new CEO, Lip-Bu Tan, following Trump’s demand for Tan’s resignation over his relationships with Chinese companies.
After having discussions with the government about potentially buying 10% shares in Intel, US Treasury Secretary Scott Bessent mentioned that any government investment would aim to help the company stabilize as it is struggling, but they would not put pressure on any US company to buy Intel chips.
Bessent noted that he has no idea how to buy shares in the company and make a deliberate effort to bring in more customers. The deal would involve converting the grant and possibly increasing investment in the once-iconic company to help it regain its footing and produce chips in the US, referring to grants allocated under the CHIPS Act.
The CHIPS Act, or Creating Helpful Incentives to Produce Semiconductors for America Act, is an American law enacted in 2022 to strengthen the domestic semiconductor industry. It gives billions of dollars in funding and tax credits to incentivize companies to manufacture chips in the United States.
He did not disclose any specific details about the size or timing of any potential US stake.
Additionally, SoftBank’s investment also comes at a time when Tokyo has pledged to invest $550 billion within the US, as agreed upon in the recent trade deal with Washington. A source familiar with the talks stated that the Intel investment is not included in that investment package.
According to people familiar with the matter, SoftBank’s decision to invest in Intel is not related to Trump. The White House did not immediately respond to a request for commentary.
Son expressed that this strategic investment shows the company’s belief that advanced semiconductor manufacturing and supply will grow more in the United States, and Intel will be playing an essential role in it.
The deal will occur at $23 per Intel share, which is a slight discount compared to Monday’s closing price of $23.66.
The investment will be executed through a primary issuance of common stock by Intel and based on Intel’s market share at the close of trading on Monday. It will represent just under 2% equity stake, according to an Intel representative.
After the announcement bout SoftBank’s investment in Intel, SoftBank shares dropped by 4% and Intel shares increased by over 7%. Sources indicate that the Japanese company will only buy an equity stake in Intel and is not interested in a board seat or committed to purchasing Intel chips.
Intel has struggled financially. It has recorded an annual loss of $18.8 billion in 2024, marking its first loss since 1986.
Intel’s longtime rival, Advanced Micro Devices (AMD), has been gaining market share in the personal computer and server semiconductor markets, while its ambitious and costly projects for the chip contracting business have failed. The company is thinking of an alternative to its contract chip manufacturing to attract big clients.
SoftBank’s Son talked with Tan after he became Intel’s CEO to discuss a potential agreement. They discussed various potential scenarios, ranging from joint ventures with third parties to smaller investments. The $2 billion investment does not include the possibility of a larger deal involving Intel’s foundry business in the future. Softbank and Intel did not respond to requests for comment. Softbank refrained from providing more details on the Intel investment when asked about it.
According to Charu Chanana, the chief investment strategist at Saxo, Intel plays a dual role, serving as both a designer and a manufacturer. It allows it to uniquely position itself as a strong contender in the United States against TSMC.
Tan, an experienced figure in the chip industry who was also a board member of SoftBank before quitting in 2022, expressed his gratitude to Son for his confidence in Intel with this investment. He added that he is pleased to have a deep relationship with SoftBank, a company that leads in many sectors, including emerging technology and innovation, and also shares a similar commitment to making the US a leader in technology and manufacturing.
This Intel investment is the latest in a series of significant investment announcements the Japanese company has made in 2025. The part of the list includes committing to finance $30 billion to OpenAI, the creator of ChatGPT, and leading the financing for Stargate.