Intel's Terafab partnership with Musk firms seen boosting AI foundry prospects

September 19, 2026 at 01:13 PM1 min

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Intel's Terafab partnership with Elon Musk-linked companies, including SpaceX, Tesla, and xAI, is positioned to expand its AI foundry business. Tigress Financial on September 15 reiterated a Buy rating and raised Intel's price target to $145 from $118, citing the alliance's strategic importance. The partnership targets advanced chip production for AI, robotics, and autonomous vehicles.

Key Facts

Tigress Financial reiterated a Buy rating on Intel and raised its price target to $145 from $118 on September 15.
The Terafab partnership involves companies associated with Elon Musk, including SpaceX, Tesla, and xAI.
Intel reported more than 130 customers testing its Core Ultra Series 3 and Core Series 3 processors for edge AI and robotics.

Partnership Scope

Intel's Terafab partnership is an ambitious semiconductor manufacturing project focused on producing advanced chips for artificial intelligence, robotics, autonomous vehicles, and other compute-intensive applications. The alliance connects Intel with companies associated with Elon Musk, including SpaceX, Tesla, and xAI. Tigress Financial highlighted the strategic importance of the alliance to Intel's turnaround prospects on September 15.

Foundry Business Impact

The Terafab partnership could provide Intel's foundry business with exposure to customers that have substantial AI and high-performance computing requirements. Securing external customers could help Intel increase manufacturing scale while improving the utilization and economics of its foundry operations. Greater production volumes and engagement with demanding customers could provide opportunities to improve manufacturing economics, yields, and scalability.

AI Supply Chain Position

Beyond manufacturing scale, Terafab could expand Intel's role in the broader AI semiconductor supply chain. Growing its foundry business could give Intel greater exposure to AI accelerators, custom silicon, and other specialized compute applications. Intel reported more than 130 customers testing its Core Ultra Series 3 and Core Series 3 processors for edge AI and robotics applications.