Intel's Latest Move Sends a Strong Signal on Musk's Terafab Moz Farooque ACCA Thu, October 8, 2026 at 8:18 AM EDT INTC +0.55% TSM -2.09% TSLA -0.75% SPCX -2.51% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Intel (NASDAQ:INTC) remains part of Elon Musk's ambitious Terafab chip project despite recent discussions between Musk and Taiwan Semiconductor Manufacturing (NYSE:TSM), easing concerns that the world's largest contract chipmaker could displace Intel from a potentially important AI infrastructure partnership.
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Intel CEO Lip-Bu Tan said the company will continue working with Musk on Terafab, according to Bloomberg. The reassurance comes after Musk confirmed earlier this week that he was discussing possible cooperation with TSMC, sparking questions about Intel's future role.
Intel joined the project in April alongside Tesla (NASDAQ:TSLA), SpaceX and xAI. The partnership is intended to advance semiconductor fabrication, chip design and advanced packaging at enormous scale, supporting Musk's goal of eventually producing enough silicon to deliver 1 terawatt of computing capacity annually.
That makes the project strategically important for Intel as CEO Tan tries to rebuild confidence in the company's manufacturing business.
Terafab could provide Intel with a high-profile customer and development partner at a time when the chipmaker is trying to prove that its foundry operation can compete for advanced AI workloads.
Musk has also pushed back against speculation that TSMC might ultimately own or operate Terafab. He said Wednesday that his companies intend to build and run the facility themselves, while TSMC could potentially sublease part of the complex.
That suggests Intel and TSMC could ultimately play different roles rather than competing for complete control of the project.
For Intel investors, the key question is how substantial its Terafab involvement becomes.
A development partnership is strategically encouraging, but investors should watch for concrete details on manufacturing nodes, production volumes, capital commitments and whether Intel ultimately earns meaningful foundry revenue from the project.
The bullish case strengthens if Musk's companies commit advanced chip production to Intel and Terafab becomes a showcase for its process technology and packaging capabilities.
The main risk is that TSMC gradually assumes a larger manufacturing role or that Terafab remains years away from meaningful production. Until commercial terms and timelines emerge, Intel's continued participation is positive, but the financial impact remains difficult to quantify.
