The US government has reduced the amount of funding Intel will receive under the CHIPS and Science Act to less than $8 billion.
In a statement published today (November 26), the Department of Commerce announced it would award the company $7.865bn in direct funding.
In March 2024, Intel was preliminarily awarded $8.5 billion in direct funding, in addition to $11bn in low-interest rate loans and a 25 percent investment tax credit on up to $100 billion of Intel’s capital investments in Arizona, New Mexico, Ohio, and Oregon.
According to a report from the New York Times, the decision was made in part because of a $3.5bn contract the company was awarded to produce advanced semiconductors for military and intelligence applications.
It has also previously been reported that Intel’s ongoing financial woes have contributed to the delay in the US government handing over the funding and, in September, Bloomberg stated that the Commerce Department was insisting that the chipmaker meet key milestones and conduct significant due diligence before any money would be handed over.
In its statement, the Department confirmed the report, saying it will disburse the funds based on Intel’s completion of project milestones.
“With Intel 3 already in high-volume production and Intel 18A set to follow next year, leading-edge semiconductors are once again being made on American soil,” said Pat Gelsinger, CEO of Intel.
“Strong bipartisan support for restoring American technology and manufacturing leadership is driving historic investments that are critical to the country’s long-term economic growth and national security. Intel is deeply committed to advancing these shared priorities as we further expand our US operations over the next several years.”
In October 2024, Intel posted a $16.6 billion loss in Q3 2024, the largest quarterly loss ever recorded by the chip maker, with $2.8bn related to its wide-sweeping job cuts. However, despite the record-breaking loss, the company’s shares rose after the results were published as the $13.38bn in revenue reported by the company beat estimates.
That same month, the company paused plans to build new chip fabs in Germany and Poland and said it would decouple its Intel Foundry Services business unit.
