Options Sir Breaks Down Hot Topics | Intel Surges 50% in Six Trading Days: Is the Chip Giant Making a Comeback?

Following the US government's decision to revitalize domestic manufacturing, $Intel (INTC.US)$ became one of the key beneficiaries and recently played three major strategic moves—a $14.2 billion buyback of full control of the Fab 34 plant in Ireland, restarting the New Mexico wafer fab to go all-in on advanced packaging, and officially entering Elon Musk’s Terafab superchip factory. The stock price surged approximately 50% over the past six trading days (from $40.63 to $59.17).Looking at these three steps together, Intel CEO Lip-Bu Tan’s strategic intent can be summarized in one sentence: using manufacturing as the baseline, building a moat with advanced packaging, and leveraging Terafab to shape the future.

$14.2 billion buyback of Fab 34

In June 2024, Intel faced a cash flow crisis and had to sell 49% of its Fab 34 wafer plant in Ireland to Apollo Global for $11.2 billion. Less than two years later, on April 1, 2026, Intel announced a full buyback for $14.2 billion, which is $3 billion more than the selling price.

Why do this?

This super wafer plant, located in Leixlip, Ireland, is one of Intel's most advanced manufacturing bases, producing core chips on Intel 3 and Intel 4 process nodes, including the Core Ultra 'Meteor Lake' processors for PCs and Xeon 6 'Granite Rapids' processors for data centers.

More importantly,For Intel, full autonomy is the cornerstone of everything。The $3 billion premium bought back not the factory, butcontrol.

On the day the news was announced, Intel's stock price soared — the market cast its vote with real money in approval.

All In advanced packaging

Intel announced the restart of its wafer fab in Rio Rancho, New Mexico, transforming it into one of the world’s largest advanced packaging bases.

Why has packaging suddenly become so important?

Because the industry consensus is:Future chip competition will not only be about 'how small you can make it,' but also about 'how well you can package it.'。

EMIB and Foveros technologies are among the few areas where Intel is widely recognized as 'leading' in the industry. As CEO Lip-Bu Tan repeatedly emphasized during the earnings call: 'Advanced packaging initiatives continue to progress well, especially in areas like EMIB and Foveros where we have true differentiation.'

If this move succeeds, Intel will not only secure packaging orders from cloud giants like Google and Amazon but also create an effective closed loop of 'manufacturing + packaging' with its own wafer production.

Entering Terafab

The Terafab project led by Musk aims to build the largest chip super factory in human history, uniting $Tesla (TSLA.US)$ , SpaceX, and xAI, three major giants.

Intel's official announcement of joining this alliance is not just a simple foundry contract but a completely new industrial model—collaboratively completing the entire process of chip design, manufacturing, and packaging. SpaceX officially refers to it as the 'Trinity' manufacturing model.

For Intel, Terafab addresses their most critical issue: the lack of major clients.

The core problem for Intel's foundry business (IFS) is the lack of substantial external clients. However, Musk’s ecosystem—including Tesla’s Optimus robots (with a long-term goal of producing 1-10 billion units annually), SpaceX’s million AI satellites, and xAI’s large-scale model training—represents astronomical levels of chip demand. This alliance provides Intel with an excellent platform to prove its manufacturing capabilities with real products.

Objectively speaking, Intel's road to a comeback is far from complete, but the following risks cannot be ignored.

Foundry operations are still 'burning cash': IFS posts annual losses exceeding tens of billions of dollars. Although the yield rate for the 18A process is improving, it is still far from achieving scaled profitability.

Uncertainty surrounding Terafab:Details about Intel's specific role in the project, revenue sharing, investment obligations, and other specifics have not been disclosed, creating significant uncertainty.

Geopolitical and competitive pressures:Taiwan Semiconductor still holds a substantial lead in advanced process technology, while Samsung is also aggressively catching up. Whether Intel’s roadmap of 'four years, five process nodes' can be delivered on schedule remains the biggest question for the market.

Options strategy

Intel's stock price has surged 190% year-to-date, hitting a 52-week high, with strong short-term momentum. However, the RSI indicator is above 70, reaching overbought territory, warranting caution.

The current implied volatility (IV) is as high as 74.37%, suggesting significant short-term fluctuations. Focus on whether the 5-day and 10-day moving averages (in the $48-52 range) provide effective support.

(1) If you don’t currently hold a position but are unwilling to chase higher prices, planning instead to buy at a lower price after a pullback,

Recommended strategy：Cash-Secured Put

Core strategy：Instead of chasing highs, reverse the approach,Let the market pay you while waiting for a pullback.。Sell put options to collect substantial premiums, and if the stock price indeed falls, you can acquire the shares at your ideal price.

Key Reminder：The premise of this strategy is — you genuinely wish to hold 100 shares of INTC at the strike price. If you don't have the intention to hold the shares, do not execute this merely for collecting premiums.

(The figure below illustrates the simulated profit and loss scenario of this strategy on the expiration date. The design image displayed on the screen is for demonstration purposes only and does not constitute any investment advice or guarantee; market conditions fluctuate frequently, and the prices shown do not represent actual values.)

(2) If you already own Intel's stock and remain bullish, but are concerned about a short-term pullback after a sharp rise,

Recommended strategy：Covered Call (Overwriting Strategy)

Core strategy：Insure your stock by purchasing put options. If the stock rises, you will only earn slightly less (stock value increase > put premium). However, if a short-term pullback occurs, the appreciation in the put option could offset or even exceed the loss from the stock decline, allowing you to break even or potentially profit.

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