Intel’s Stock Meltdown Risks Eroding Trump-Endorsed Comeback

Intel Corp.’s stock slide is delivering a reality check to President Donald Trump’s vision for quickly reviving domestic chip manufacturing led by an American champion, four months after the US moved to acquire as much as a 10% stake in the company.

Though Chief Executive Officer Lip-Bu Tan managed to win the president’s confidence and save his own reputation in Washington, turning around his company is proving more arduous. Intel’s shares plunged Friday, tumbling as much as 17.5%, following a lackluster forecast that highlighted the company’s struggles in lining up big customers. 

Just a few weeks ago, Trump had praised the company’s progress and its “very successful” CEO, as the president assessed early returns on the US investment. Tan took a more sober tone when speaking to investors on Thursday following the release of Intel’s quarterly results. 

“We are on a multiyear journey,” Tan said on a conference call with analysts. “It will take time and resolve, but my team and I are committed to rebuilding this iconic American company.” 

Intel’s first-quarter projections for revenue and earnings fell well short of Wall Street estimates. The company also disclosed that it still doesn’t have an anchor customer for its most advanced 14A process, though it expects firmer decisions from buyers in the second half of the year or the first half of 2027. 

Intel shares were down 17% at 1:16 p.m. New York time, on course for their biggest one-day decline since 2024. 

Tan acknowledged to investors that yields — the number of non-defective chips produced compared with the total possible capacity — are below his expectations. This metric is at the heart of chip manufacturing, as poor yields are likely to weigh on margins and deter possible customers for its foundry business, which makes chips for outside clients in its fabrication plants. 

“Customers aren’t going to lock in unless they know they have a manufacturing process that can deliver,” JoAnne Feeney, a partner and portfolio manager at Advisors Capital Management, said in an interview Friday on Bloomberg Television. “You have to know the supply will be there if you commit to a certain manufacturing partner. It’s a real chicken and egg problem.”

Since plans emerged for the US to become one of Intel’s top shareholders, the Santa Clara, California-based company’s stock had more than doubled, feverish gains that were pared by the latest projections. So far, the US owns 5.5% of Intel, a stake that’s currently worth roughly $12 billion, with options for the government to take ownership of additional shares in the future.

White House spokesman Kush Desai said Trump “remains committed to reshoring critical manufacturing and supporting American companies with a full policy suite of tariffs, tax cuts, and deregulation. The Trump administration’s equity stake in Intel in particular represents how we are investing in the long-run success of American technology and manufacturing.” 

Spokespeople for the US Commerce Department didn’t immediately respond to a request for comment.

Some analysts see the US investment in the company as a crucial backstop to its long-term success. “This makes Intel’s fabs a strategic asset to the US military, and Intel has the full backing of the US government,” Gus Richard, an analyst at Northland Securities, wrote. “Intel needs to leverage its US government contacts and its US military industrial base foundry business into broader commercial relationships.”

While the success of Intel’s turnaround may not be clear for several more quarters, Taiwan Semiconductor Manufacturing Co. is already achieving what Intel has sought. That includes building in the US, where TSMC plans to invest another $100 billion in Arizona as part of a Taiwan trade deal unveiled by the Trump administration last week. TSMC has promised to bring 12 advanced manufacturing and packaging facilities to Arizona by the mid-2030s. 

Under the Taiwan agreement, companies investing in the US will receive an exemption on future potential chip tariffs to import as much as 2.5 times their American capacity, reducing the odds that the levies would make Intel’s products more attractive in the US market. Still, TSMC’s decision to continue adding manufacturing in Arizona points to a positive long-term trend for Intel: continued growth in demand for AI chips. 

Intel has begun shipping its sub-2-nanometer 18A chips, a generation behind 14A, to customers from its manufacturing facilities in Arizona and Oregon. The company’s Chips Act-sponsored investment in Ohio has been repeatedly delayed, and the company avoided any mention of it in the Thursday investor call. The more than $28 billion project was supposed to be producing chips last year, but Intel now doesn’t expect to begin operations until 2030. 

With assistance from Ian King, Ed Ludlow and Caroline Hyde.

©2026 Bloomberg L.P.

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