Intel Stock Hits 52-Week High After AI Chip Announcement—Should You Buy INTC Now?

Intel (NASDAQ: INTC) shares jumped more than 6% in early Friday trading after President Donald Trump confirmed that the U.S. government will acquire a 10 % equity stake in the chipmaker, a move designed to stabilize the company’s multibillion-dollar turnaround and secure domestic semiconductor supply chains. The White House is expected to formalize the agreement later today. According to people familiar with the talks, the Treasury-backed investment will be structured as preferred shares that convert to common stock after five years, giving Washington both upside participation and limited voting rights. The cash infusion—roughly $10.5 billion at current market value—comes on the heels of a $2 billion private placement from Japan’s SoftBank Group announced earlier this week, underscoring renewed confidence in Intel’s recovery strategy. Momentum in INTC stock today reflects investor relief that the long-rumored government deal avoids immediate dilution for existing shareholders while unlocking additional CHIPS Act grants that had been tied up in congressional negotiations. The capital will be earmarked for accelerating Intel Foundry’s 18A and 14A process nodes, expanding the company’s Ohio and Arizona fabs, and shoring up its advanced-packaging capacity—critical steps if Intel hopes to win outsourced production from Qualcomm, Apple and, eventually, Nvidia. CEO Lip-Bu Tan, who took the helm in March, has already trimmed operating expenses by 12 % and exited non-core divisions such as drone components and Optane memory. Tan told employees in an internal memo obtained by market analysts that the government stake “provides the runway we need to execute the fastest product roadmap in the company’s history,” citing Arrow Lake desktop CPUs and Gaudi-3 AI accelerators slated for volume shipment in 2026. Wall Street reaction has been cautiously optimistic. Evercore ISI upgraded Intel stock to “Outperform,” arguing that the combined public-private financing “dramatically lowers bankruptcy risk and positions Intel to claw back data-center market share from AMD by 2027.” Still, bears highlight the near-term pressure on gross margin—expected to hover around 37 % this year—while the preferred-share structure could cap upside if conversion triggers are met before free cash flow turns positive. Geopolitical tailwinds are also in focus. By taking an equity position, Washington gains board-observer rights and a direct lever over any future technology transfers to Chinese partners, a sensitive topic after Intel’s failed NAND sale to SK Hynix in 2023. National-security analysts say the precedent could ripple across the U.S. semiconductor landscape, with smaller players such as GlobalFoundries and Wolfspeed likely to seek similar arrangements to finance new fabs without ceding control to foreign sovereign funds. From a technical standpoint, INTC stock is now testing its 200-day moving average near $28, a level not seen since May. A decisive break could open a path toward the psychological $30 mark, though options markets are pricing in elevated volatility ahead of Intel’s investor day on September 10, when Tan will outline updated 2025 revenue targets and cap-ex guidance. Key takeaway for traders: Intel stock today sits at the intersection of industrial policy and semiconductor innovation. If management executes on its foundry ambitions while leveraging government backing to de-risk the balance sheet, INTC could pivot from a value trap to a growth story—making the current pullback an opportunity rather than a warning sign for long-term investors.