Elon Musk said his chip venture Terafab is in early talks with TSMC about Texas factories. Intel, named a Terafab partner in April, fell about 2% on a flat day for chips while TSMC's U.S. shares reached a 52-week high.
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A short post from Elon Musk moved two chipmakers in opposite directions on Monday.
Over the weekend, Musk confirmed on X that his chip venture, Terafab, is in talks with Taiwan Semiconductor Manufacturing Co. about factories in Texas. "Just discussions, but something may come of it," he wrote.
The moves
Intel shares fell about 2% to near $117 in afternoon trading, after being down as much as 4% earlier. The iShares Semiconductor ETF was roughly flat. TSMC's U.S.-listed shares rose about 2.7% to near $485.72, a 52-week high, after the stock gained about 3% in Taipei.
Intel was named a Terafab partner in April. The prospect of TSMC joining the project, alongside Intel or in its place, is what investors were weighing.
Where things stand
For now the talks rest on Musk's own account, and he framed them as early. Whether TSMC would work alongside Intel or in its place, and at what scale, is the open question the companies have yet to address.
That leaves the market pricing a possibility. Intel's decline is modest relative to what losing Terafab's business would mean. TSMC's gain is modest relative to its size.
Two readings
One reading is that a second foundry in talks with Terafab signals Intel's position is less secure than investors assumed in April, and that Musk's ventures will buy capacity from whoever can deliver at scale.
The other is that discussions are not contracts, that large customers routinely talk to more than one supplier, and that Monday's moves reflect headline sensitivity more than a change in either company's outlook.
What would settle it
A statement or filing from Intel, TSMC or Terafab on the partnership is the first marker. Intel's next quarterly report, where analysts are likely to ask about Terafab, is the next.