Intel Shares Surge Following Partnership With Elon Musk’s Tesla and SpaceX

Intel announced on April 7, 2026, that it has joined the Terafab AI chip complex project, a partnership with Elon Musk’s SpaceX, Tesla and xAI. The collaboration aims to manufacture processors designed to power data centers and robotics.

The project centers on the development of a massive chip-production facility located in Austin, Texas. The Terafab plant is expected to cost approximately $25 billion.

The partnership targets the generation of 1 terawatt of AI power. Intel will provide the chip-manufacturing experience necessary to accelerate the project’s development and production timeline.

Operational Role and Strategic Goals

Intel’s involvement is intended to increase the probability of the project’s success by leveraging its existing fabrication expertise. The semiconductor industry is characterized by high capital intensity and significant operational complexity, particularly regarding fabrication production yields.

The Terafab facility is intended to produce reliably usable semiconductors for the specific needs of SpaceX, Tesla, and xAI, supporting aggressive compute output goals.

Market Reaction

Following the announcement on April 7, 2026, Intel’s stock experienced a positive response. While some reports indicated a surge of 2% or 3%, other data showed the stock closed the day up more than 4%.

Tesla’s stock ended the same trading session down roughly 1.8%.