Intel Corp. will work with Elon Musk’s artificial intelligence firm, xAI, on a new chip manufacturing facility in Austin, Texas, according to a report from Bloomberg News published Wednesday. The project, which sources cited by Bloomberg referred to as a “Terafab,” is part of xAI’s plan to build a supercomputer to power its developing AI models.
According to the report, which cited individuals familiar with the matter, Intel’s foundry division will be involved in the project. A foundry is a company that manufactures semiconductor chips designed by other firms. The specifics of Intel’s role have not been publicly detailed, but the collaboration would involve providing manufacturing or assembly services for the components needed for xAI’s supercomputer.
Both Intel and representatives for xAI have not issued public comments on the matter.
The development aligns with the publicly stated strategy of Intel Chief Executive Officer Pat Gelsinger to expand the company’s contract chipmaking business, known as Intel Foundry. This division was established to compete directly with industry leaders such as Taiwan Semiconductor Manufacturing Co. (TSMC) and Samsung Electronics Co. by producing advanced processors for external companies. Securing a project with a high-profile technology venture like xAI would represent a step forward in that initiative.
For xAI, the construction of a dedicated supercomputer is central to its goal of developing artificial intelligence systems capable of competing with those from companies like OpenAI and Google. Musk has previously stated that the advancement of AI will require a massive increase in computational power. The “Terafab” is intended to provide the necessary infrastructure for training and running the large-scale AI models the company is developing.
The facility’s name, a portmanteau of “tera” and “fab,” suggests a focus on large-scale production. “Tera” is a prefix denoting one trillion, often used in computing to measure processing speed (teraflops), while “fab” is industry terminology for a fabrication plant where semiconductors are made.
Details regarding the project’s timeline, the total investment involved, and the specific technologies to be used remain limited. The report indicates the project is in its early stages.
