Funding for the semiconductor giant is cut to under $8 billion, reflecting financial challenges and investment delays.

Intel won't be happy about the 6% reduction in subsidies but certainty that the rest of the money is coming would be welcome.

The U.S. government plans to reduce Intel Corp's preliminary $8.5 billion federal chips grant to less than $8 billion, the New York Times reported on Sunday citing unnamed sources. The change took into account a $3 billion contract Intel had been offered to make chips for the Pentagon,

In October, Intel posted its biggest quarterly loss in the entire 56-year history of the company, facing more pressure than ever to reduce its costs.