Owning the Means of Production
The Trump administration’s push for a 10% equity stake in Intel (NASDAQ:INTC), leveraging $10.9 billion in CHIPS Act grants — $7.9 billion for domestic investments and $3 billion for defense microelectronics — has ignited debate.
This non-voting stake could make the U.S. government Intel’s largest shareholder, part of a series of unconventional deals, including extracting 15% of Nvidia (NASDAQ:NVDA) and Advanced Micro Devices‘ (NASDAQ:AMD) AI chip revenue from China and an equity stake in rare earth magnet producer MP Materials (NYSE:MP).
Now, Trump eyes similar stakes in other CHIPS Act recipients, raising concerns about government overreach. Critics warn of corporate statism, citing risks of political interference, while supporters see it as securing U.S. technological dominance. Commerce Secretary Howard Lutnick, the cabinet official driving this initiative with Treasury Secretary Scott Bessent, argues, “We should get an equity stake for our money.”
According to Bloomberg, much of the funding under the CHIPS Act has not yet been dispersed for many companies, but the four stocks below that were awarded among the most in CHIPS Act funds after Intel.
Taiwan Semiconductor Manufacturing (TSM)
Taiwan Semiconductor Manufacturing (NYSE:TSM), the global leader in chip fabrication, secured $6.6 billion in CHIPS Act grants to expand its Arizona manufacturing hub, producing advanced chips for AI and other applications.
The company’s $65 billion investment includes three factories, with production yields matching Taiwan’s. Taiwan’s Economy Minister has emphasized TSM’s private status, signaling resistance to U.S. equity demands. A government stake could deter TSM’s global partners, given its 90% share of advanced chip production.
Trump’s tariff threats add pressure, but the foundry’s massive U.S. investment may be a strategic move to avoid tariffs and secure funding. Equity stakes risk complicating TSM’s operations and alienating shareholders, yet they align with U.S. goals to reduce reliance on foreign chips, especially amid China-Taiwan tensions.
Micron Technology (MU)
Micron Technology (NASDAQ:MU), a U.S.-based memory chipmaker, received $6.2 billion to build a “mega-fab” in New York and a facility in Idaho, part of a $100 billion investment plan. Its focus on memory chips for AI and data centers makes it critical to U.S. tech ambitions.
An equity stake could strain Micron’s financial strategy, as it competes in a volatile memory market. Shareholders may balk at government involvement, fearing diluted control. However, Micron’s domestic focus aligns with Trump’s reshoring goals, potentially softening resistance.
The non-voting stake structure aims to limit governance issues, but legal challenges loom if investors perceive overreach. Micron’s role in reducing U.S. dependence on Asian supply chains strengthens its case, but government ownership could disrupt its market-driven innovation.
GlobalFoundries (GFS)
U.S.-based foundry GlobalFoundries (NYSE:GFS) secured $1.5 billion in CHIP Act financing to expand its New York facility and modernize its Vermont plant, focusing on specialized chips for automotive and defense. Its niche in mature-node semiconductors makes it a national security asset.
An equity stake could raise shareholder concerns about autonomy, given GlobalFoundries’ smaller market presence compared to TSM or Samsung. The non-voting structure may mitigate governance risks, but legal challenges from investors are possible. Its alignment with U.S. security goals strengthens its position, yet government involvement could hinder its agility in a competitive market.
GlobalFoundries’ domestic focus may ease acceptance of Trump’s plan, but its smaller scale amplifies risks of overreach.
Texas Instruments (TXN)
Texas Instruments (NYSE:TXN) is a U.S. semiconductor stalwart and was awarded $1.6 billion to enhance its Texas and Utah foundries, producing analog and mixed-signal chips critical for automotive and industrial applications.
Its established U.S. presence aligns with CHIPS Act goals, but an equity stake could unsettle investors wary of government influence. The non-voting stake aims to address governance concerns, yet the risk of political interference persists, especially given Texas Instruments’ stable market position.
Trump’s push could strengthen U.S. supply chains but may deter innovation if perceived as overreach. TXN’s’ smaller CHIPS funding makes it less central to the debate, but its role in diversifying production remains significant.
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