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Trade Wars
Elon Musk’s Terafab Chip Factory In Texas Could Cost Up To $119 Billion, Filing Shows
Elon Musk’s plans for a huge chip manufacturing plant in East Texas will cost at least $55 billion for the first phase, and up to $119 billion if the full buildout comes to fruition. The estimated capital investment amounts were disclosed in a public hearing notice on Wednesday in Grimes County, Texas, home of the prospective facility. The notice said SpaceX, which is controlled by Musk, is seeking a property tax abatement agreement from the county.
Musk is aiming for Terafab to be the “most epic chip-building effort ever - combining logic, memory and advanced packaging under one roof,” according to a post on X last month from SpaceX, which now owns artificial intelligence company xAI. He officially launched the project in March. The chip complex outside Austin would be designed to manufacture chips for SpaceX, xAI and Tesla, and jointly built by those companies.
Read more at CNBC
Nvidia, Corning Partner On Massive Optical Fiber Deal That May Be A Game Changer For AI
Nvidia is partnering with glassmaker Corning for three new advanced manufacturing facilities in North Carolina and Texas dedicated entirely to optical technologies for the world’s most valuable semiconductor company. The factories will lead to the creation of at least 3,000 jobs and increase Corning’s U.S. optical manufacturing capacity by 10-fold, the companies said in a joint press release on Wednesday. Financial terms weren’t disclosed.
The multiyear deal brings together two infrastructure players that have seen their fortunes skyrocket since the launch in 2022 of OpenAI’s ChatGPT, which sparked an explosion of investments into new processors and systems for powering cutting-edge AI models and workloads. While the two companies didn’t provide specifics about what’s being developed, Nvidia is likely gearing up to replace copper with Corning’s optical glass fibers in its AI rack-scale systems, an integration known as co-packaged optics.
Read more at CNBC
Mortgage Rates Hit The Highest Level In A Month, Causing First-Time Homebuyers To Drop Out
Mortgage rates continued to climb higher last week, causing both current homeowners and potential homebuyers to retreat from the market, especially first-time buyers. Total mortgage application volume fell 4.4% compared with the week before, according to the Mortgage Bankers Association’s seasonally adjusted index. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances, $832,750 or less, increased to 6.45% from 6.37%, with points rising to 0.66 from 0.61, including the origination fee, for loans with a 20% down payment.
Applications for a mortgage to purchase a home dropped 4% for the week and were just 5% higher than the same week one year ago. The spring housing market has been a bumpy one, starting out very slowly when rates rose sharply in March. It seemed to be picking up recently, as rates fell back and more supply came on the market, but buyers again are struggling with affordability. “The average loan size on a purchase application increased to $467,300, the highest in the survey’s history dating back to 1990. This increase could indicate that potential first-time buyers, and buyers looking for homes at lower price points, might be the most hesitant to move forward,” said Joel Kan, vice president and deputy chief economist at the MBA.
Read more at CNBC
U.S. Space Force Awards $3.2 Billion for Space-Based Interceptor Layer
The U.S. Space Force (USSF) Space Systems Command announced on Monday, May 4, the award of 20 Other Transaction Authority (OTA) agreements totaling up to $3.2 billion to a group of 12 companies. The funding is part of the Golden Dome for America’s Space-Based Interceptor (SBI) program, a generational effort to establish a proliferated Low Earth Orbit (pLEO) constellation capable of intercepting ballistic and hypersonic threats during boost, midcourse, and glide phases.
The Golden Dome architecture utilizes advanced sensor fusion and artificial intelligence to counter the extreme maneuverability of modern hypersonic missiles. SciTec will provide specialized data processing layers, while Booz Allen focuses on command-and-control (C2) prototype systems. True Anomaly’s role involves developing interceptor platforms designed to scale rapidly while maintaining low unit costs. These systems will be integrated with the broader proliferated Warfighter Space Architecture, ensuring that interceptors can receive real-time targeting data from NRO-procured commercial imagery and government-owned tracking layers.
Read more at Satellite News
AMD Stock Soars On Q1 Earnings Beat, Better-Than-Expected Outlook
AMD reported its first quarter results after the bell on Tuesday, beating analysts’ expectations on the top and bottom lines and topping Wall Street’s projections on second quarter revenue outlook. For the quarter, AMD saw earnings per share (EPS) of $1.37 on revenue of $10.25 billion. Analysts were calling for EPS of $1.28 and revenue of $9.89 billion, according to Bloomberg analyst consensus estimates. The company saw EPS of $0.96 and revenue of $7.43 billion in the same quarter last year. Data center revenue came in at $5.8 billion, up 57% year over year.
In the second quarter, AMD says it will see between $10.9 billion and $11.5 billion in revenue. Wall Street had the amount pegged at $10.52 billion. CPUs are becoming increasingly important in data centers due to the explosion of interest in AI agents, semi- or fully autonomous AI bots that can perform tasks on users’ behalf. When agents take action, they use tools and software that run on CPUs, driving a massive increase in processor demand. AMD sells its own line of CPUs. It also offers high-powered GPUs for training and running AI models, giving it the chance to attract a broader array of customers.
Read more at Yahoo Finance
The Wegovy Pill Saw The Fastest Take-Up In Weight-Loss Drug History. Novo Nordisk Only Narrowly Lifted Guidance.
Novo Nordisk on Wednesday narrowly improved its financial guidance for a year where it still sees profit and sales falling after the fastest take-up in weight-loss drug history for its Wegovy pill. Novo Nordisk said it achieved 200,000 weekly prescription in the U.S. for the Wegovy pill by mid-April, which it said was the fastest take-up ever in the GLP-1 category of drugs in the U.S., which includes the injectable Wegovy and Ozempic and rival Eli Lilly’s Mounjaro.
The company’s Wegovy pill achieved 2.26 billion Danish kroner ($350 million) of sales in the first quarter, still a long way from the 18.23 billion kroner of sales for the Wegovy injectable and 27.82 billion kroner for Ozempic, which just saw its own pill version launched on May 4. Novo Nordisk said the Wegovy pill hasn’t cannibalized the injectable version of the drug while also attracting users of rival products.
Read more at MarketWatch
Raytheon Wins Rush Order for Patriot Missiles
The Pentagon issued a four-month, $441.6-million contract to Raytheon RTX to deliver Patriot GEM-T missiles to the U.S. Army by September 30, in support of Operation Epic Fury - the ongoing conflict with Iran. The assignment to Raytheon is a single expenditure, not part of a budgeted purchase of supplies, and it is to be paid from FY 2026 special funds (not standard defense appropriations) with all the funding to be paid at once.
A similar sense of urgency in defense appropriations was notable in a recent Pentagon purchase of Himars mobile rocket launchers from Lockheed Martin. Published estimates put the total number of Patriot missiles interceptors fired during March and April 2026 at more than 1,200. Raytheon manufactures the Patriot Advanced Capability-2 system; Lockheed manufactures the PAC-3. Both are mobile, ground-based systems, and typically the two missile types are deployed in tandem to comprise a layered defense system.
Read More at American Machinist
P&G Flags $150M Hit From Iran War Supply Disruptions
Procter & Gamble expects a $150 million after-tax drag this fiscal year ending June 30 as higher oil-related costs and shipping disruptions from the Iran war raise supply expenses, CFO Andre Schulten said in an April 24 earnings call. To blunt the impact, P&G plans to reformulate products, diversify its supply base and look at short-term productivity levers it could pull, he said. The Iran war’s disruption of the flow of oil through the Middle East has raised supply costs for companies across many industry sectors, including automotive, CPG and food and beverage.
“We see some suppliers just not being able to supply at all. We see some manufacturing facilities that have been compromised by the war,” Schulten said. “And so it’s not just the oil price, it’s also the availability of product and input costs.” For P&G, sourcing changes driven by cost or availability were pushing it onto less efficient routes for getting materials, resulting in higher transportation costs, longer lead times and elevated inventories, Schulten said. When materials are not available, the company is reformulating into alternative inputs that often carry upcharges to avoid diluting product performance, Schulten said.
Read more at Manufacturing Dive
How Efficiency Is Mitigating the Iran War’s Energy Shock
One of the major surprises about the gravest energy shock since the 1970s is how resilient much of the world has been so far. The closure of the Strait of Hormuz has yanked around 13 million barrels of oil a day from global energy supplies. Even so, in the two months since the strait was closed by Iran in response to U.S. and Israeli attacks, many of the world’s major economies have been soldiering on in contrast to the swift downturns that accompanied similar energy crises in the 1970s and 1990s. Stock markets are touching record highs.
This resilience reflects ample energy reserves, policies to help consumers and the offsetting effects of the artificial-intelligence boom that is powering trade and business investment in the U.S. and beyond. It also highlights an underappreciated shift in the workings of the global economy. Over the years, countries have become steadily more energy efficient, squeezing more economic activity out of each drop of oil or cubic meter of natural gas burned. The energy needed to generate a dollar of gross domestic product, adjusted for inflation, has since 2000 fallen by about a third in the U.S. and Europe and by about 40% in China, according to World Bank data.
Read more at the WSJ
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