Intel receives $3.5 billion for US military chips

intel logo and US flag at construction site with yellow machine

intel logo and US flag at construction site with yellow machine

Intel will receive an investment of $3.5 Billion from the U.S. government, according to a report from Bloomberg.

With the passing of the U.S. CHIPS and Science Act Act in 2022, this amount is expected to be part of the total $10 billion package. However, it could also be part of the previously announced ‘Secure Enclave’ project and exist as its own agreement.

Intel is set to become one of the biggest semiconductor players and defence contractors in the United States. The new spending bill passed recently in the House of Representatives stated that the payments would be made over three years in a project titled “Super Enclave”. According to reports, Intel has specifically asked for somewhere between $3 billion and $4 billion and got a value exactly in the middle.

Earlier in February, it was reported that Intel will receive funds up to 10 billion USD from a massive pool of $39 billion for grants and $75 billion for loans. Currently, it remains unclear whether this 3.5 billion USD is part of the $10 billion or in addition.

The Commerce Department has already announced grants to BAE Systems PLC and GlobalFoundries. It will now look to include Samsung and Taiwan Semiconductor Manufacturing to have massive domestic manufacturing ability.

They also issued a statement saying, “The department looks forward to continuing to work with Congress on implementing the Chips and Science Act in a manner that promotes our economic and national security.

Stuart Pann, the head of Intel Foundry, had said "The government funding allows us to operate with much lower-sophistication PDKs than somebody would normally run test chips with," He went on to say, "So that has been really instrumental in helping us learn how our customers view our process or performance, the classic PPAC (power, performance, area, and cost)”

The plans are to move away from the older-generation semiconductors towards a more modern product.

As the Senate is set to pass the legislation before the Saturday deadlines, some concerns have been raised by Senators Maria Cantwell and Jack Reed. Both of them point towards an award handed to a company building a super enclave at a much higher price than it technically should have been last year.

Check out more about Nvidia’s new AI superchips that gargle power with 1,000W pull and OpenAI needing $7 trillion to continue AI chips development.

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