SoftBankMakes Surprise $2 Billion Bet on Intel’s AI Revival (1)
2025-08-19 04:46:39 GMT
By Min Jeong Lee and Nick Turner
(Bloomberg) -- SoftBank Group Corp. agreed to buy $2
billion of Intel Corp. stock, a surprise deal to shore up a
struggling US name while boosting its own chip ambitions.
The Japanese company, which is adding Intel to an
investment portfolio that includes AI linchpins Nvidia Corp. and
Taiwan Semiconductor Manufacturing Co., will pay $23 a share — a
small discount to Intel’s last close. Shares of the US
chipmaker, which will issue new stock to SoftBank, surged more
than 5% in after-hours trading. SoftBank’s stock fell as much as
5.4% Tuesday in Tokyo, its most since April.
SoftBank, which owns Arm Holdings Plc, has for decades
tried to be a central player in AI, but has been largely a
bystander to a global spending boom in hardware. Progress has
been slower than expected at Stargate, a $500 billion endeavor
with OpenAI, Oracle Corp. and Abu Dhabi fund MGX to build data
centers in the US. Masayoshi Son’s plan to design an energy-
efficient chip to better compete alongside Nvidia through the
“Izanagi” project has also yet to translate into a marketable
product.
“It’s hard to see how much this investment contributes to
either SoftBank’s value or short-term earnings,” said Tomoaki
Kawasaki, senior analyst at Iwaicosmo Securities.
For Intel, the Tokyo-based company’s move delivers a strong
vote of confidence in a storied US chipmaker that’s struggled to
remain relevant in the AI sphere.
Intel aims to prove it can be a technology leader again
after falling behind TSMC in contract chipmaking and Nvidia in
chip design. CEO Lip-Bu Tan met with US President Donald Trump
at the White House last week, helping lay the groundwork for
discussions around ways to rescue Intel.
The Santa Clara-based company held talks with the Trump
administration about a deal that would potentially turn the US
into its biggest backer. Officials have discussed taking a stake
of about 10% in the chipmaker, Bloomberg News reported Monday.
Read More: Trump Administration Said to Discuss Taking 10%
Intel Stake
For SoftBank, buying Intel stock expands its US footprint
at a time Tokyo is pressing Washington to cut tariffs in
exchange for investments in the US. SoftBank recently inked
adeal to buy Foxconn Technology Group’s electric vehicle plant
in Ohio in a move that could kickstart Stargate. That’s as some
of Asia’s biggest companies including TSMC and Samsung
Electronics Co. reiterate plans to spend billions of dollars on
factories in the US.
But the timing of the deal — days after Trump and Tan’s
meeting — is spurring fears that politics may have played a
part. “If it’s political, then it’s not profit-motivated,” said
Amir Anvarzadeh, Japan equity strategist at Asymmetric Advisors.
“Investing in Intel to appease Trump is perhaps not seen as good
business.”
In announcing its investment in Intel, SoftBank paid
tribute to the chip pioneer’s history.
“For more than 50 years, Intel has been a trusted leader in
innovation,” Son said in a statement. “This strategic investment
reflects our belief that advanced semiconductor manufacturing
and supply will further expand in the United States, with Intel
playing a critical role.”
Intel CEO Tan, a chip industry veteran who took the helm
this year, has invested in startups alongside Son and spent
years on SoftBank’s board as an independent director before
resigning in 2022.
“I appreciate the confidence he has placed in Intel with
this investment,” Tan said.