Shares in the chip maker rose following news of SoftBank’s planned investment and a possible stake for the U.S. government.

SoftBank's investment will come via a primary issuance of common stock by Intel, and, based on the U.S. company's market capitalisation at close of trading on Monday, represent an equity stake of just under 2%, an Intel spokesperson said.

Intel is getting a $2 billion investment in common stock from SoftBank, which is betting big on the AI revolution.

The U.S. chipmaker has struggled to keep pace in the AI market alongside competitors like Nvidia. Softbank has agreed to buy Intel common stock at $23 per share.

The two companies said SoftBank's stake in Intel was a bet on the growing market for artificial intelligence, which Intel has struggled to serve.

Japanese investment giant SoftBank has announced a substantial US$2bn investment in Intel, the major American semiconductor company. This move marks a significant vote of confidence for Intel, which has faced scrutiny, including pressure from U.S. political figures calling for the resignation of its CEO.

The move could signal SoftBank’s chip ambitions, as the company may be gearing up to build Arm CPU tiles, AI XPUs, and Ampere chips tied to the Stargate Project.

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