Intel Receives Nearly $8 Billion in CHIPS Act Grant: Source

chip manufacturer Intel According to an individual conversant in the matter, the CHIPS and Science Act offices are near finalizing an agreement that might give the corporate a grant of about $8 billion because the Biden administration approaches the inauguration of the president-elect Donald Trump desires to distribute money.

That $8 billion would go toward constructing Intel's factories, the person said. The Commerce Department is predicted to finish the award in the approaching weeks, said the person, who spoke on condition of anonymity to debate nonpublic information.

Intel can also be facing a $3 billion contract to make chips for the Defense Department, a deal announced in September and a rare brilliant spot in the corporate's struggling efforts to expand its fab business. The Commerce Department and Intel declined to comment on the matter.

The Wall Street Journal initially reported that the 2 sides were near finalizing the grant.

But Intel's problems have worsened because the grant was first announced. The New York TimesCiting 4 people conversant in the matter, the corporate reported Sunday that the federal government decided to chop the subsidy by about $500 million due to uncertainties about Intel's ability to implement its investment commitments and since of Intel's Changing technology roadmap and customer demand.

Awarded by the USA Taiwan Semiconductor Manufacturing Co. A $6.6 billion grant was awarded earlier this month, raising expectations amongst investors that money funding for Intel would come soon. Intel has benefited from the CHIPS tax breaks but has not yet received any money bonuses, something Intel CEO Pat Gelsinger has expressed dissatisfaction with.

“We're frustrated that we haven't moved faster,” Gelsinger told CNBC in October, referring to the CHIPS grants. “They were too bureaucratic in this process. We can’t wait for these to be completed.”

U.S. House Speaker Mike Johnson, R-La., had previously said he might consider repealing the bipartisan law but then walked back those comments. The Biden administration and grant recipients have touted the laws as a job creation machine.

Intel's problems have increased significantly this yr. The company posted a lack of nearly $17 billion in its most up-to-date quarter and has scaled back Gelsinger's ambitious plans globally.

Intel announced earlier this yr that it will cut 15,000 jobs through layoffs and voluntary buyouts. The company has taken steps to more easily separate its foundry business from its legacy business and has been working with advisers on the activists' defense and a broader strategic review, people conversant in the matter previously said. As CNBC previously reported, Intel can also be trying to boost money through a minority stake within the Altera business and has been exploring interested buyers for weeks.

It is also a once unthinkable prospect: a possible takeover offer from an up-and-coming company Qualcommwhose market capitalization now dwarfs that of Intel.