SoftBank is investing $2 billion in Intel, giving the Japanese company a 2% stake in the US chipmaker. The deal comes as part of SoftBank’s broader strategy to expand its presence in the AI market and gain a foothold in emerging technologies.
The investment marks a significant turnaround for Intel, which has been struggling under new CEO Lip-Bu Tan. Tan shifted Intel’s focus to cost-cutting and sticking to its core business after being installed earlier this year. Despite efforts to bolster homegrown chipmaking, Intel still faces intense scrutiny due to its former ties with China.
SoftBank’s decision to invest in Intel is seen as a vote of confidence in Tan’s leadership. The company already owns 40% of the Stargate project, a $500 billion promise to build AI infrastructure in the US that aims to create 100,000 jobs and bolster American chipmaking.
The investment also comes amidst concerns over SoftBank’s own stake in semiconductor IP developer ARM, which poses conflicts of interest. The relationship between SoftBank and the Trump administration has been previously scrutinized due to ties with China.
Intel’s foundry business is struggling as its next-gen 18A and 14A process nodes are on the chopping block if it can’t secure enough customer commitments. SoftBank’s $2 billion stake in Intel demonstrates trust in Tan’s leadership, but the company’s history of questionable investment choices remains a concern.
The investment marks a significant shift in the AI market, with both SoftBank and Nvidia vying for dominance. Intel has struggled to keep up with AMD in consumer x86 and server markets, making its turnaround uncertain despite Trump’s interventions.
Source: https://www.tomshardware.com/tech-industry/softbank-reportedly-considered-buying-intels-foundry-division-outright-before-investing-usd2-billion-into-the-company-as-equity