Why Intel Stock Skyrocketed This Week

Key Points

• Last week, President Trump called for the resignation of Intel's CEO, citing security concerns from his investment ties to the Chinese government.

• Intel's stock first jumped earlier in the week on the news that its CEO would meet Trump at the White House.

• Yesterday, shares went up after news broke that the administration is considering taking a stake in Intel.

• 10 stocks we like better than Intel ›

Shares of Intel (NASDAQ: INTC) are soaring this week, up 24.1% as of 3:13 p.m. ET. The spike comes as the S&P 500 (SNPINDEX: ^GSPC) was up 1%, and the Nasdaq-100 was up 0.5%.

The struggling chipmaker's stock is jumping after its CEO met with Trump at the White House; rumors are spreading that the administration may take a stake in the company.

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A high-stakes meeting goes well

After Trump called on CEO Lip-Bu Tan last week to resign because of his alleged ties to the Chinese government, a meeting was arranged. The White House visit appears to have gone quite well, with Trump saying Tan has an "amazing story."

Now it's being reported that the Trump administration is considering taking a stake in the troubled but strategically important chipmaker. The deal would partially hinge on Intel continuing with its recently abandoned plans to open a manufacturing hub in Ohio.

Image source: Getty Images.

Intel has real strategic importance

Despite its struggles in artificial intelligence (AI), having lost significant ground to Nvidia and Advanced Micro Devices, Intel remains strategically important due to its significant domestic manufacturing capabilities, something its rivals lack. Semiconductor fabrication capacity within the U.S. is not something that Trump wants to reduce, one of the few areas in which this administration and its predecessor are in alignment.

Intel's path to relevance in the uber-crucial AI market is unclear. However, given the company's strategic importance, I still think Intel is a good pick for investors with an appetite for risk.

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Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Intel, and Nvidia. The Motley Fool recommends the following options: short August 2025 $24 calls on Intel. The Motley Fool has a disclosure policy.