US Cuts Intel’s Chips Grant Below $8B After New Deal
The U.S. government plans to reduce Intel's initial $8.5 billion federal chips grant to less than $8 billion. This adjustment considers a $3 billion contract offered to Intel for manufacturing chips for the Pentagon.
Earlier this year, President Biden's administration announced nearly $20 billion in grants and loans to boost Intel's domestic semiconductor production. This funding is part of the 2022 CHIPS and Science Act, designed to enhance U.S. semiconductor output with a total of $52.7 billion, including $39 billion for production subsidies and $11 billion for research and development.
The reduction in funds is also linked to Intel's delay in completing an Ohio chip manufacturing facility. In October, Intel reported its largest quarterly loss in 56 years, intensifying pressure to reduce costs.
Despite these challenges, Intel's shares rose by 3% following the announcement. The final grant amount is yet to be determined, as the U.S. government continues to assess Intel's financial performance and project timelines.
