Deepti Sri
4 min read
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Terafab targets its first test chip around May or June 2027 and volume production in the third quarter of 2028.
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Musk called SpaceX’s capex efficiency “greatly underestimated,” responding to a projection of $470 billion in spending over five quarters.
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Musk expects new Colossus 2 facilities online in November and December, targeting around 1.2 million Blackwell chips by year-end.
Shares of Space Exploration Technologies Corp. (SPCX) jumped over 3% in overnight trading late Sunday after CEO Elon Musk defended the company’s capex efficiency and outlined fresh AI expansion targets, while a report pointed to renewed Terafab talks with TSMC.
SPCX stock traded around $139 overnight, recovering part of Friday’s 6% slide to $134.72. Shares lost about 11% in October, their worst month since July.
Musk Reportedly Rethinks TSMC’s Terafab Role
Musk may be easing his demand to control Terafab, with DigiTimes reporting fresh talks with Taiwan Semiconductor Manufacturing Co. (TSM). TriOrient research executive Dan Nystedt said on X that discussions would cover operational control, joint investment, technology and packaging and component bottlenecks.
The development comes after Musk said last month: “No, we will build and run the fab. Let there be ZERO doubt about that.” He had left TSMC only the option of subleasing part of the site. Meanwhile, TSMC CEO C.C. Wei confirmed the talks last month but insisted that any participating fab must be run by TSMC.
Terafab, the SpaceX-Tesla (TSLA) venture with Intel as a partner, targets its first test chip around May or June 2027 and volume production in the third quarter of 2028, Reuters reported.
Musk Pushes Back On AI Spending Doubts
“Our capex efficiency is greatly underestimated,” Musk said on X, responding to a projection that SpaceX could spend $470 billion over the next five quarters to reach 13 gigawatts of computing capacity by the end of 2027.
The estimate came from Kyle Reidhead, co-owner of investing media platform Milk Road. His model assumes fast construction would generate revenue to fund further expansion, projecting quarterly revenue of about $122 billion by late 2027 and $150 billion in debt. He estimated that Nvidia could capture 83% to 89% of the spending, potentially $414 billion. SpaceX already expects $35 billion to $40 billion in fourth-quarter capital spending. Third-quarter revenue rose 161% to $14.58 billion, including $7.56 billion from AI.
