Intel Gains on Musk's Terafab Chip Timeline, But Analysts Doubt 2028 Mass Production

Elon Musk signaled a potential breakthrough in chip manufacturing for the Terafab AI chip project, targeting first working test chips by May or June 2027 and volume production in the second half of 2028, a boost for Intel (INTC), which participates in the SpaceX- and Tesla-backed venture. Speaking on SpaceX's earnings call Tuesday, Musk said the team has "some potentially significant breakthroughs" in chip manufacturing but is "still figuring out chipmaking," acknowledging substantial uncertainty around the aggressive timeline. Test chips would be made at a separate Austin research facility, with the main Texas site slated for 2028 production. Seaport Research Partners analyst Jay Goldberg remains cautious on actual output. He said initial equipment deliveries may not arrive until 2028—enough to train staff but insufficient for a commercial fab. Goldberg estimates a large-scale plant costs about $30 billion and must run near-continuously, seeing a workable facility by 2028 and commercial-scale output by 2030 as achievable. He also flagged a possible TSMC role, which Musk said would supplement rather than replace Intel. Intel shares rose over 1% to $92.96 Wednesday, trailing AMD's 3.3% and Nvidia's 2.5% gains. The stock is down about 23% over the past month but up 136% year to date.