The American chip champion Intel (INTC, Financial) is only inches away from finalizing two major deals: one from the CHIPS and Science Act Grant and the other from a Department of Defense contract.
CHIPS and Science Act Grant:
The U.S. Department of Commerce under the CHIPS and Science Act is set to grant Intel $8.5 billion to support Intel's semiconductor manufacturing projects in Arizona, New Mexico, Ohio and Oregon.
Intel is known to win full support from Gina Raimondo, the U.S. Commerce Secretary, that has actively encouraged companies like Nvidia (NVDA, Financial) and Apple (AAPL, Financial) to use Intel's foundries for their chip production making Intel a trusted partner for the government.
Department of Defense Contract:
As geopolitical tension rises around Taiwan where advanced chips are produced, the government has decided to reduce reliance on foreign supply chain of advanced microelectronics for defense and intelligence applications.
Intel is now poised to secure a $3 billion contract from the Department of Defense to manufacture advanced semiconductors for more secure and reliable domestic supply chain for national security purposes.
The government sees Intel as a strategic partner and positions Intel to compete with TSMC (TSM, Financial) and Samsung in the future.
These two deals are efforts from the government to strengthen the U.S. semiconductor industry and reduce reliance on foreign chip production while on the same time creating jobs and fostering technological innovation in the U.S.
