Intel shares drop on foundry risks, sector pressures

Intel Corporation shares fell 5.4% in morning trading Thursday, as the company faced pressure from multiple sources including questions about its foundry business and an incident at an overseas manufacturing facility.

The stock traded well below its 52-week high of $142.35 as investors weighed news that Elon Musk's Terafab initiative is in active talks with Taiwan Semiconductor Manufacturing Company over a dedicated chip manufacturing facility. The development raised questions about whether Intel will maintain its previously announced role as a central foundry partner for Terafab's clients, which include Tesla, SpaceX, and xAI.

The potential shift away from Intel had been a key part of the investment thesis supporting the company's manufacturing turnaround strategy, prompting investors to reconsider the stock's valuation.

The decline also reflected continued pressure from Wednesday's session, when an explosion at Intel's Kiryat Gat facility in Israel affected one of the company's key manufacturing sites and sent shares lower. The stock closed Wednesday at $98.12 before opening lower Thursday.

Intel filed a Form 4 insider activity disclosure on October 14, though the financial size of the transaction was small.

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