Intel (INTC) stock rose nearly 3% in early trading Wednesday, extending gains from the prior day when Vice President JD Vance made bullish comments about domestic chip manufacturing.

“To safeguard America’s advantage, the Trump administration will ensure that the most powerful AI systems are built in the US with American designed and manufactured chips," Vance said at an address at the AI Summit in Paris Tuesday.

Intel stock jumped 6% following the comments. Though Intel has a heaping pile of internal issues that have set back its dominance in chip manufacturing, the company is one of the United States' biggest hopes for domestic AI chip production. Intel is the only large scale American leading-edge foundry for computer chips — which means it manufactures chips for itself and other companies. 

The overwhelming majority of the world’s most advanced chips for AI are manufactured in Taiwan by TSMC (TSM). Even Intel outsources production of its most advanced AI chips to its rival. While Korea’s Samsung (005930.KS) and TSMC have expanded operations in the US thanks to financial incentives from the US CHIPS Act, most of their manufacturing capacity is in their home countries.

It’s unclear how Trump would "ensure" AI systems in the US use US-made chips, as Vance said. Trump on his campaign trail bashed the CHIPS Act, a set of financial incentives for chip companies aimed at bolstering domestic production, which was passed under President Joe Biden but authored under Trump’s first administration. Trump suggested on an appearance on the Joe Rogan Experience in October that he would put tariffs on chip imports, believing that would force companies to relocate to the US.

“[Y]ou put a big tariff on the chips coming in. I say, 'You don't have to pay the tariff, all you have to do is build your plant in the United States,'" he said.

Meanwhile, Intel has fallen far behind TSMC in manufacturing, and current employees at Intel’s foundry told Yahoo Finance in December that its latest manufacturing process for AI chips has “a lot of issues.” 

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Intel’s long-term commitment to foundry has also recently been called into question. The company began its recent, massive push toward opening up its manufacturing business to external customers under CEO Pat Gelsinger, who was ousted by the board in December as investors grew impatient with the money-losing approach. Intel is in the process of searching for a new CEO. In the past week, Intel’s AI chief left the company to take on the role of CEO of Nokia.

Despite the two-day gain, Intel stock is down more than 50% from last year, and its market cap of $91 billion is a fraction of those of Big Tech firms. The company reported its third consecutive year-over-year decline in quarterly revenue in January. Zinsner said Intel Foundry is working to meet its goal of “delivering breakeven operating income” by 2027.”

Intel’s still-nascent foundry business continues to be a drag on its overall revenue despite announcing agreements to build chips for Amazon’s (AMZN) AWS and Microsoft (MSFT), as Yahoo Finance's Dan Howley reports. 

Laura Bratton is a reporter for Yahoo Finance. Follow her on Bluesky @laurabratton.bsky.social. Email her at laura.bratton@yahooinc.com.

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