Intel secures $2 billion SoftBank investment amid turnaround efforts

By Al Mayadeen English
Source: News websites
19 Aug 2025 10:56
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Intel has secured a $2 billion equity investment from Japan’s SoftBank Group, marking a major endorsement as the US chipmaker undergoes a challenging turnaround, giving SoftBank a nearly 2% stake in Intel.

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The logo of Japan's Softbank Group is displayed the company's head office in Tokyo on August 7 2025. (AFP-Yonhap)

Intel is receiving a $2 billion equity injection from Japan’s SoftBank Group in a move that marks a strategic vote of confidence in the struggling US chipmaker. The investment, announced August 18, will make SoftBank one of Intel’s top-10 shareholders and comes as the company pushes ahead with a major turnaround strategy.

The funding, which will be delivered through a primary issuance of common stock, gives SoftBank an equity stake of just under 2%, according to an Intel spokesperson. At $23 per share, the purchase price comes in slightly below Intel’s closing price of $23.66 on Monday. Once finalized, SoftBank will become the sixth-largest investor in the company, based on LSEG data.

SoftBank's CEO Masayoshi Son emphasized the broader significance of the deal, stating, "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."

While SoftBank will not seek a board seat or commit to purchasing Intel’s chips, the move aligns with its broader ambitions in artificial intelligence and semiconductor infrastructure. It also adds to SoftBank’s already substantial AI-related portfolio, which includes a $500 billion US-based Stargate data center project.

A vote of confidence amid Intel’s struggles

Intel has faced mounting challenges in recent years, including a reported $18.8 billion annual loss in 2024, its first such loss since 1986. The company has struggled to retain ground against long-time rival AMD in the personal computing and server chip markets. Meanwhile, its efforts to build a chip manufacturing business that could rival Taiwan’s TSMC have yet to gain significant traction.

Analysts remain cautious. Reuters reports that Amir Anvarzadeh, Japan equity strategist at Asymmetric Advisors, remarked, “SoftBank’s investment helps, but it is not what is going to move the dial for Intel.”

Intel CEO Lip-Bu Tan has reportedly met with US President Donald Trump amid speculation that the US government may also be considering a stake in the company. Bloomberg News reported discussions of a potential 10% US government stake, although the White House has not commented.

No ties to Tokyo-Washington investment package

The deal also follows Tokyo’s announcement of a $550 billion investment package into the US last month, part of a broader trade agreement. However, a Japanese government source clarified that the Intel investment is not part of that deal.

A person familiar with the matter also denied any link between the SoftBank investment and political motivations, despite speculation about Son’s relationship with Trump.

SoftBank shares dropped more than 5% following the announcement, while Intel rose by 5.6% in after-hours trading.

Intel is now reconsidering its chip manufacturing strategy as it seeks to become more competitive in the rapidly growing AI sector. “Intel’s dual role as designer and manufacturer/fabricator uniquely positions it as potentially the best platform in the US to compete with TSMC,” said Charu Chanana, chief investment strategist at Saxo.

Lip-Bu Tan, who previously served on SoftBank’s board before stepping down in 2022, thanked Son for the show of support: “The confidence he has placed in Intel with this investment is deeply appreciated.”

The deal marks the latest in a series of large-scale commitments by SoftBank in 2025, including a $30 billion pledge to OpenAI and leadership in the financing of Stargate.