TSMC in Talks for Musk's Terafab; Intel Falls 3.2% as CEO Lip-Bu Tan Reaffirms Partnership

Intel CEO Lip-Bu Tan said Wednesday the company will continue working with Elon Musk on Terafab, after reports that TSMC may build and operate a dedicated fab for the project. Intel shares closed down 3.2% at $112.50 on Tuesday, extending losses as investors digested the news; TSMC's ADR hit a record high Monday. Musk confirmed on X that Tesla and SpaceX are discussing the TSMC arrangement, saying "it's just a discussion, but there may be progress." He agreed with a post describing Terafab as massive, with any TSMC capacity serving as a supplement. Intel signed on as a Terafab development partner in April, a deal that helped its stock surge 114% that month. Barron's noted the damage may be less severe than it appears, citing Intel's multiyear Alphabet partnership and Nvidia's $5 billion investment last year for co-developed custom processors. Analysts also suggested TSMC and Intel could split work on the project rather than one replacing the other.