
In a significant show of support for the struggling US chipmaker in the midst of a turnaround, SoftBank Group is investing $2 billion in Intel. The once-iconic US company, which has failed to compete after years of management errors that left it with virtually no presence in the expanding artificial intelligence chip market, is getting a lifeline from the equity investment, which the firms disclosed on Monday.
The $500 billion Stargate US datacenter project is part of the Japanese tech investor’s big bet on semiconductor and AI assets, and it will make SoftBank a top-10 shareholder in Intel. According to the Financial Times, which quoted several people with knowledge of the discussions, SoftBank also discussed purchasing Intel’s contract chipmaking division prior to the investment announcement on Tuesday.
After spending billions of dollars to establish a contract manufacturing company, Intel has had little success competing with Taiwan’s TSMC and has hardly drawn in outside clients. “SoftBank’s investment is helpful, but it won’t change Intel’s situation,” stated Amir Anvarzadeh, Asymmetric Advisors’ Japan equity strategist.
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