Intel Corp. Chips Act Subsidies
The Commerce Department continues to dole out money as part of the Chips Act, and Intel Corp. shares are rising premarket Tuesday as some investors appear hopeful the company will soon rake in serious funds.
Potential $10 Billion in Subsidies
Intel could receive upwards of $10 billion in subsidies consisting of both loans and direct grants, as reported by Bloomberg News late Friday. The report noted that the Biden administration was in talks about the funding, which would be the largest award made with money from the 2022 Chips and Science Act that was meant to bolster the U.S. semiconductor-manufacturing industry.
Intel shares were up 3.5% in premarket trading Tuesday.
Intel and the Commerce Department didn’t immediately respond to a request for comment on their plans.
GlobalFoundries Receives $1.5 Billion for Expansion
Meanwhile, the department announced Monday that it had agreed to preliminary terms with GlobalFoundries Inc. that would give the company $1.5 billion to expand its capacity and modernize its New York and Vermont manufacturing sites. GlobalFoundries shares were roaring more than 7% higher premarket Tuesday.
Intel's Big Week in Chip-Manufacturing Industry
While the timing of an Intel grant announcement from the Commerce Department remains uncertain, this week holds significance for Intel's chip-manufacturing business. An event exclusively focused on its foundry business is scheduled for Wednesday, with Melius Research analyst Ben Reitzes dubbing it as one of Intel's most pivotal events in recent memory.
Domestic Semiconductor Supply Vitality
In a strategic shift, Intel had declared its intention to produce chips not just for its own operations but also for other companies. Reitzes emphasized the critical nature of a stable domestic supply of semiconductors, likening it to the importance of the US strategic oil reserves. The demand for AI chips is expected to rise across various sectors such as defense, necessitating a reliable domestic foundry in the USA.
Future Prospects and Expectations
Despite the upcoming event, Reitzes does not anticipate the disclosure of customer names. However, he hinted that the attendees' composition might hint at potential customers. Noteworthy is the virtual presence of Commerce Secretary Gina Raimondo at Intel's event, sparking speculation about a forthcoming grant related to the US Chips Act in the first half of the year.
All Rights Reserved © 2024
Post a comment