Intel (INTC) stock spiked more than 7% Thursday and continued to climb 3% before the market open on Friday, following a report that the US government is considering taking a stake in the troubled chipmaker.
Bloomberg reported that the Trump administration is in talks with Intel about the deal, which would help the company complete its Ohio factory expansion that had been put on hold.
The report follows a meeting between President Trump and Intel CEO Lip-Bu Tan earlier this week, which came after the president called for the CEO’s resignation due to his ties with China.
“As Intel’s prospects have dimmed, the idea of support (governmental or otherwise) has gained traction, understandable given the company, for better or worse, remains the only US-headquartered prospect for leading edge semiconductor chips and processes; it seems like Trump may have been persuaded to see the light,” Bernstein analyst Stacy Rasgon wrote in a note to investors Friday.
It’s not the first time the Trump administration has allegedly floated ideas to prop up Intel. In February, a news report said the US was pitching proposals to its rival TSMC to help support its turnaround by establishing a joint venture with Intel.