Intel (NASDAQ:INTC) stock advanced 3% in Tuesday’s session, moving above $52 after news broke that SpaceX, Tesla (NASDAQ:TSLA | TSLA Price Prediction), and xAI are partnering with Intel on the ambitious TeraFab semiconductor initiative. The move builds on an already remarkable run for the stock, which was up 37.62% year-to-date heading into today.
The TeraFab announcement gives Intel’s foundry turnaround story a high-profile vote of confidence. For a company that has spent the better part of two years convincing investors its manufacturing ambitions are real, landing Tesla CEO Elon Musk’s ecosystem as a partner is no small thing.
TeraFab: What It Is and Why Intel Is in the Mix
TeraFab is Elon Musk’s plan to vertically integrate into semiconductor production, driven by his view that chip manufacturing will be a critical bottleneck for AI development in the years ahead. The project is a joint venture between Tesla, SpaceX, and xAI, and aims to produce 1 terawatt of compute annually. Musk has described it as “the most epic chip building exercise in history.”
Intel has announced its intention to join the $20 billion project, which is set to begin in Austin. Note that Intel isn’t just providing commodity manufacturing here; it’s being tapped for its full-stack capabilities, from process technology to advanced packaging. That’s exactly the differentiated foundry pitch that Intel CEO Lip-Bu Tan has been making to investors since taking the helm.
Intel’s Foundry Ambitions Get a Real-World Test
Intel’s foundry business has been the most closely watched and most skeptically viewed part of its turnaround. The Intel Foundry segment generated $4.507 billion in revenue in Q4 2025, up 4% year over year, but still posted an operating loss of $2.51 billion. The losses are real, and the path to profitability requires exactly the kind of external customer wins that TeraFab represents.
Intel’s 18A process node, touted as the most advanced semiconductor technology developed and manufactured in the U.S., is currently ramped up to high-volume manufacturing in Arizona and Oregon. Tan declared in January, “The introduction of our first products on Intel 18A marks an important milestone, and we’re working aggressively to grow supply to meet strong customer demand.”
The TeraFab partnership is a meaningful validation of that 18A narrative. Musk’s companies need cutting-edge, domestically produced silicon at scale, and Intel is currently the only U.S.-based company with leading-edge logic manufacturing capabilities. That’s a structural advantage that’s hard to replicate quickly.
Strong Momentum Heading Into Earnings
Intel shares have risen sharply, partly fueled by the company’s strategic repurchase of Apollo Global Management’s 49% equity stake in its Fab 34 facility for $14.2 billion earlier this month. Momentum traders and long-term investors alike are paying attention.
The recent run has pushed Intel stock well above both its 50-day moving average of $46.16 and its 200-day moving average of $35.29, a technical setup that tends to attract additional buying interest. That said, the analyst consensus target of $47.11 now sits below the current price, meaning the stock has outrun near-term Wall Street expectations. Execution will need to keep pace with enthusiasm.
For a deeper look at how Intel stacks up against its primary domestic rival heading into this pivotal year, this analysis of AMD vs. Intel’s 2026 positioning is worth a read. The competitive dynamics in server CPUs and AI accelerators remain fluid, and the TeraFab partnership could shift the calculus meaningfully in Intel’s favor.
What to Watch Next
The next major inflection point for Intel stock is Q1 2026 earnings on Thursday, April 23, after market close. Investors will be looking for updates on 18A node yields, foundry customer pipeline growth, and any additional color on the TeraFab partnership scope.
For the time being, Intel’s foundry story is still in early innings, and the operating losses are a genuine concern for anyone underwriting a premium valuation here. Watch for whether today’s gains hold into the close and whether further details on the TeraFab partnership structure emerge ahead of Intel’s earnings call.
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