The Trump administration is likely negotiating a deal to take up to a 10% equity stake in Intel Corp. This will be facilitated by converting grants made under the 2022 Chips and Science Act into equity.If the deal sails through, it is set to become one of the most combative federal interventions by the US government in a tech company since the 2008 bailout.The company, as of the second quarter of the financial year 2025, is sitting on a loss of $2.9 billion, or 67 cents per share, compared with a $1.61 billion net loss, or 38 cents per share year-on-year.On an annual basis the stock is up just 10% compared to its peer Nvidia which has soared 36.50% in the same period. Safe to say the company is fallen behind rivals like Nvidia and TSMC in AI chip design and advanced manufacturing.In terms of earnings, Nvidia will report its second-quarter result for financial year 2025 soon. Looking at the previous quarter, the chipmaker reported net income for the quarter ended April of $14.88 billion, or $5.98 per share, compared with $2.04 billion, or 82 cents, in the year-earlier period.The problems keep compounding for Intel, as highlighted by a recent firing of 15% of the staff by its newly appointed CEO, Lip-Bu Tan. The company seems to be struggling with a cash crunch, as Tan also announced cuts in chip factory construction at multiple locations.And, in an unexpected political hurdle US President Donald Trump demanded the immediate resignation of the CEO Lip-Bu Tan, calling him highly conflicted due to his ties with Chinese firms.Trump raised doubts about the CEO's plans to turn around the struggling American chip icon. “The CEO of Intel is highly CONFLICTED and must resign, immediately,” he posted on Truth Social. “There is no other solution to this problem," Trump said.Among the primary reasons sparking the US government's interest in Intel is the race against China for AI supremacy. But, whether the government's involvement would keep Intel afloat is yet to be seen and understood. However, one upside here could be the fact that the government would become one of Intel's largest shareholders if the deal goes through. This move will align the US government directly with the company, possibly bringing the firm into too big to fail net.Trump's Intel Stake Plan Backed By Rival Bernie Sanders In Rare Show Of Support. Read more on Markets by NDTV Profit.