Intel Partners with Terafab to Accelerate Chip Production
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Apr 07 2026
0mins
Should l Buy INTC?
Source: Fool
- Strategic Partnership: Intel has announced its role as a major partner in Elon Musk's Terafab chip manufacturing project, which not only enhances the likelihood of the project's success but also accelerates its development and production timeline, potentially positively impacting Intel's market position.
- Investment Scale: The Terafab plant is expected to cost around $25 billion; while high spending does not guarantee excellent semiconductor production, Intel's involvement may improve reliability in meeting the demands of SpaceX, Tesla, and xAI.
- Market Competition: Despite facing strong competition from TSMC, which commands over 70% of the global contract chip manufacturing market, partnering with Musk could provide Intel with a significant market opportunity, especially as U.S. domestic manufacturing capabilities gain importance.
- Future Outlook: The success of the Terafab project could serve as a catalyst for Intel's semiconductor business, helping it achieve breakthroughs in advanced chip manufacturing and meeting investor expectations for future growth.
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Analyst Views on INTC
Wall Street analysts forecast INTC stock price to fall
29 Analyst Rating
5 Buy
19 Hold
5 Sell
Hold
Current: 63.810
Low
20.00
Averages
39.30
High
52.00
Current: 63.810
Low
20.00
Averages
39.30
High
52.00
About INTC
Intel Corporation is a global designer and manufacturer of semiconductor products. The Company operates through three segments: Intel Products, Intel Foundry, and All Other. Its Intel Products segment includes Client Computing Group (CCG), Data Center and AI (DCAI), Network and Edge (NEX). The CCG is bringing together the operating system, system architecture, hardware, and software application integration to enable PC experiences. DCAI delivers workload-optimized solutions to cloud service providers and enterprises, along with silicon devices for communications service providers, network and edge, and HPC customers. NEX helps networks and edge compute systems from fixed-function hardware to general-purpose compute, acceleration, and networking devices running cloud native software on programmable hardware. The Intel Foundry segment comprises technology development, manufacturing and foundry services. All Other segments include Altera, Mobileye, Other.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Supply Constraints Impact: Intel expects to face peak supply constraints in Q1 2026; however, the company anticipates these constraints will ease starting in Q2, leading to above-seasonal results in subsequent quarters.
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- Computing Capacity Goals: Terafab is expected to deliver about one terawatt of annual compute capacity, which will not only support Tesla's vehicle autonomy and robotics programs but also provide infrastructure for space-related initiatives tied to SpaceX, highlighting Tesla's ambitious goals in the AI sector.
- Positive Market Reaction: Following Musk's push for suppliers to accelerate, shares of Applied Materials and Lam Research rose over 1% and 3% respectively, while Tesla's stock climbed about 1%, reflecting market optimism regarding Tesla's AI chip manufacturing plans.
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See More
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See More
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- Maximum Upside: Nebius represents a high-risk, high-reward investment, with its annual run rate projected to soar from $1.25 billion at the end of 2025 to between $7 billion and $9 billion, showcasing its immense growth potential amid surging AI demand.
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See More
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See More
