The U.S. government holds an unrealized gain of approximately $26.5 billion on its Intel stake. This surge follows a more than 22% jump in Intel's shares after a strong first-quarter earnings report.
The position originated from an August deal where the government converted $8.9 billion in CHIPS Act grants and Secure Enclave funding into 433.3 million Intel shares at $20.47 each. This gave the government about a 9.9% ownership. With Intel's stock near $81.80, the holding is now valued at around $35.4 billion.
The government also holds warrants for an additional 5% stake at $20 per share, which are now significantly profitable.
Intel's rally was fueled by its first-quarter revenue of $13.6 billion, up 7% year-over-year, surpassing Wall Street expectations. Non-GAAP earnings per share were $0.29, a significant improvement over the anticipated $0.01 loss.
Growth was primarily driven by Intel's Data Center and AI segment, which saw a 22% increase to $5.1 billion due to rising demand for Xeon processors supporting AI infrastructure.
Intel forecasts second-quarter revenue between $13.8 billion and $14.8 billion.