TAKE A LOOK AT THE LOONY HERE, AND YOU CAN SEE, WELL, NOT MUCH MOVEMENT AT ALL. LET'S MOVE ON FROM CANADA. THE BIDEN-HARRIS ADMINISTRATION'S BIG BET ON INTEL TO LEAD A U.S. CHIP-MAKING REVOLUTION IS IN TROUBLE AS A RESULT OF THE COMPANY'S MOUNTING FINANCIAL STRUGGLES. WE DISCUSS WITH BLOOMBERG TECHNOLOGY CO-HOST ED LUDLOW, ALSO I WOULD SAY AN EXPERT ON INTEL. YOU'VE INTERVIEWED PAT ON A NUMBER OF OCCASIONS. THE C.E.O. IS HE IN TROUBLE? ARE THEY GOING TO BE ABLE TO CARRY OUT THE PLANS AND GET THEIR HANDS ON THIS MONEY FROM THE GOVERNMENT? THERE'S A LINE IN THE BLOOMBERG REPORT FROM LAST WEEK ABOUT INTEL'S DIRECTION TO BANKERS LOOKING AT STRATEGIC

OPTIONS THAT PAT IS RUNNING OUT OF TIME. BUT THIS FRUSTRATION -- THERE'S FRUSTRATIONS ON BOTH SIDES. THERE'S FRUSTRATIONS FROM INTEL ACCORDING TO OUR SOURCES THAT THE CHIPS ACT MONEY THEY SECURED, 8.5 BILLION DOLLARS IN GRANTS AND ABOUT 11 BILLION DOLLARS IN LOANS IS NOT FORTHCOMING. INTEL WANTS IT SOONER. THEY WANT ACCESS TO IT. BUT IT COMES WITH STRINGS ATTACHED. WHICH BASICALLY IS PROOF OF WORK ON THEIR MANUFACTURING FOOTPRINT EXPANSION AND VETTING AND THAT'S THE FRUSTRATION ON THE ADMINISTRATION ECONOMIST DEPARTMENT SIDE. THEY MADE RULES ABOUT THE ACCESS TO CAPITAL. INTEL REALLY NEEDS IT BUT IT'S ALSO PER OUR REPORTING PULLING BACK ON ITS AMBITIONS BECAUSE FINANCIALLY IT'S UNDER DURESS. AND WE SEEM TO BE AT A PRETTY

TRICKY SPOT RIGHT NOW. KATIE: OF COURSE, LIBBY FROM PIMCO WAS TELLING US EARLIER ABOUT HOW UNFORTUNATE THIS IS FOR THE BIDEN ADMINISTRATION. JUST WHEN IT COMES TO TIMING HERE. BUT THERE'S BEEN A BEVY OF BAD NEWS WHEN IT COMES TO INTEL. THIS IS FROM REUTERS REPORTING THAT BROADCOM'S TEST INVOLVING SENDING SILICON WAFERS THROUGH INTEL'S MOST MANUFACTURING PROCESSES FAILED. HOW BIG OF A SETBACK IS THAT? WHAT INTEL WOULD TELL IS YOU THAT THEY ARE ACTIVELY ENGAGED WITH, SAY, A DOZEN CUSTOMERS WHO WOULD ON PAPER TAKE ADVANTAGE OF THEIR MANUFACTURING OR FOUNDRY BUSINESS. THE CUTTING EDGE PROCESS THEY HAVE CURRENTLY IS CALLED 18-A. THE REUTERS REPORT SAYS THAT BROADCOM RAN A TEST, THEY RAN SILICON WAFER THROUGH THE

PROCESS AND IT FAILED, AND THE CONCLUSION PER THE REUTERS REPORT THAT BROKE UNREACHED IS THAT THAT INTEL PROCESS IS NOT VIABLE FOR VOLUME PRODUCTION. THE RESPONSE FROM AN INTEL SPOKESPERSON IN THAT REPORT WAS THEY'RE STILL ON TRACK FOR THEIR ORIGINAL TIMELINE. BUT TO JOIN ALL THE STORIES TOGETHER, INTEL NEEDS THE CHIPS ACT MONEY TO RAMP UP ITS FOUNDRY OPERATIONS. IT ALSO NEEDS THIRD-PARTY CUSTOMERS WHO ARE GENUINELY AND TANGIBLY REVENUE-GENERATING FOR THEM TO USE THAT TO STEM ITS FINANCIAL LOSSES. AT THE SAME TIME, THEY'RE HAVING TROUBLE PROVING THAT THAT PROCESS IS GOING WELL, AND PER THE REPORTING AT BLOOMBERG LAST WEEK, THEY'RE HAVING TO MAKE TOUGH DECISIONS TO SCALE BACK. BE THAT STRATEGIC DECISIONS LIKE SEPARATING OUT THE FOUNDRY.

BUSINESS OR MORE LIKELY CUTTING BACK ON EXISTING PROJECTS. SO HOW CAN YOU GO IN GOOD FAITH TO THE U.S. GOVERNMENT AND SAY, WE WANT THE CHIPS ACT MONEY SOONER BUT ALSO BE SORT OF LOOKING AT YOUR OWN BALANCE SHEET AND PLANNING AND SAYING, WE'RE GOING TO HAVE TO PULL BACK ON OUR MANUFACTURING EXPANSION.

Biden's Bet on Intel to Lead US Chipmakers Is in Trouble

Welcome to the Bloomberg Technology YouTube channel. Subscribe for original series and mini-docs on game-changing technologies, profiles on innovators, live conversations with experts, and breaking technology news & analysis from Bloomberg TV.

Biden's Bet on Intel to Lead US Chipmakers Is in Trouble

Scripts