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The U.S. government is increasingly investing in AI supply chains due to the technology’s crucial role in national security. As part of this initiative, billions of dollars are being funneled into companies that provide essential components like semiconductors and rare earth materials. This trend mirrors past industrial booms, where lesser-known companies experienced significant stock surges due to their critical supply roles; for example, Lithium Americas Corp. rose over 930% from January 2009 to January 2010, while OmniVision climbed around 460% during the same period.
Key investments have shown compelling results: Intel saw a ~77% stock increase after a government equity stake in August 2025, while MP Materials surged 228% following Pentagon investment in July 2025. Companies that align with federal priorities could experience similar gains as governmental support continues to shape the AI landscape.
China currently dominates the rare earth processing and battery supply industries, controlling 90% and 70% respectively. This situation has heightened the urgency for U.S. entities to secure supply lines and strengthen AI capabilities, as evidenced by the creation of the Office of Strategic Capital and the announcement of a public AI Action Plan aimed at bolstering domestic production.
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