SANTA CLARA, California: Intel will receive a US$2 billion equity investment from Japan's SoftBank Group, giving the struggling U.S. semiconductor giant a financial boost as it works to regain ground in the artificial intelligence chip race.

The deal comes after years of missteps that have left Intel lagging behind rivals and facing its first annual loss since 1986 — $18.8 billion in 2024. The investment makes SoftBank a top-10 shareholder and marks its latest major bet on AI, following commitments to OpenAI and its massive $500 billion Stargate data center initiative.

SoftBank will pay $23 per share for Intel's newly issued stock, giving it an equity stake just under two percent, according to Intel. Based on current market capitalization, SoftBank would rank as Intel's sixth-largest investor, LSEG data shows.

"This strategic investment reflects our belief that advanced semiconductor manufacturing and supply will further expand in the United States, with Intel playing a critical role," SoftBank CEO Masayoshi Son said in a statement.

Intel shares rose 5.6 percent in after-hours trading on the news, while SoftBank stock fell more than five percent in Tokyo on August 19.

The investment is separate from recent reports that the U.S. government may also consider taking up to a 10 percent stake in Intel, following a meeting between CEO Lip-Bu Tan and President Donald Trump. Sources told Reuters SoftBank's decision was not tied to those discussions, and the Japanese investor does not plan to seek a board seat or commit to buying Intel's chips.

For Intel, the funds offer breathing room as it struggles to reestablish itself in advanced chip manufacturing and compete with Nvidia, which dominates the AI chip market. The investment follows a string of setbacks for Intel, including production delays and leadership upheaval.

The deal also extends SoftBank's aggressive investment streak in 2025. In addition to backing Intel, the group has pledged $30 billion to OpenAI and is leading funding for the Stargate project, a U.S. mega data center venture. Foxconn said it will manufacture data center equipment with SoftBank in Ohio as part of Stargate.