Intel Corp. (NASDAQ:INTC) just got the kind of public endorsement its foundry ambitions have been missing — from Elon Musk.

Shares of Intel gained on Tuesday after it joined the Terafab project alongside SpaceX, xAI and Tesla Inc. (NASDAQ:TSLA). The move positions the chipmaker at the center of Musk's latest attempt to redesign silicon fabrication technology. 

The company said its capabilities in designing, manufacturing and packaging high-performance chips at scale will support Terafab's goal of producing 1 terawatt of compute per year to advance future AI and robotics.

Intel added that it hosted Musk at its facilities over the weekend, a detail that reinforces the idea this is not just a paper partnership but a strategically important relationship-building moment with one of the largest potential AI-compute buyers on the planet. 

For investors, Musk's visible stamp of approval on Intel's manufacturing roadmap is a key signal as the company tries to reposition from legacy PC leader to cutting-edge AI foundry.

Musk shared Intel's post and said, "Looking forward to working with Intel on the Terafab!"

Terafab

In March, Musk unveiled Terafab, a joint venture with SpaceX aimed at transforming chip manufacturing for space and AI applications. 

He said the project will integrate efforts from Tesla, SpaceX and xAI to produce over 1 terawatt of compute per year, with roughly 80% allocated to space and 20% to Earth-based use. 

Terafab is envisioned as an end-to-end chip facility that combines design, testing and packaging in one location — something Musk said "doesn't exist anywhere in the world."

Intel – Strategic AI Foundry Partner

For Intel, plugging into that narrative matters for valuation and its reputation as an AI foundry. 

As Intel aligns itself with a high-growth AI and robotics ecosystem spanning Tesla's autonomous vehicles, Optimus humanoid robots and the D3 chip for space-based, solar-powered AI systems, the story shifts toward long-duration AI infrastructure demand rather than cyclical PC and server CPU sales. 

Even before concrete revenue from Terafab rolls in, the narrative shift and validation from Musk can support INTC's multiple expansion, as investors become more willing to underwrite Intel as a strategic AI foundry partner rather than a turnaround laggard.

INTC Price Action: Intel climbed 4.19% in Tuesday's session, according to Benzinga Pro data. The stock is 3.4% below its 52-week high, with a Relative Strength Index (RSI) of 60.0, which indicates strong momentum.

This image was generated using artificial intelligence via Gemini.