Intel's Fab 28 explosion shuts the plant for two weeks and costs $600 million
The mid-October blast in Kiryat Gat killed two workers. Intel expects a $300 million revenue hit in both Q4 2026 and Q1 2027, almost all of it 10nm Xeon parts.
The explosion at Intel's Fab 28 in Kiryat Gat, Israel, in mid-October will cost the company about $600 million in lost revenue across two quarters. The blast killed two people and seriously injured one, and it forced Intel to shut the entire facility for roughly two weeks. CFO Dave Zinsner disclosed the figures on Intel's October 29 earnings call.
The financial hit
Intel expects to lose about $300 million of revenue in the fourth quarter of 2026 and a similar amount in the first quarter of 2027. The incident should also shave around two percentage points off fourth-quarter non-GAAP gross margin, because Intel is still sorting through the wafers that were mid-production when the plant went dark. Zinsner expects most write-offs of unrecoverable wafers to land in Q4, which is why the margin damage is concentrated there even though shipments stay disrupted into 2027.
"We feel like we are going to be starting up production here by the end of this week," Zinsner told analysts, pointing to a restart on Friday, October 30. Intel has not said how quickly the fab will climb back to full output, how many wafers were damaged, or which Xeon families are affected.
Why server chips take the brunt
Fab 28 builds chips on Intel's 10nm-class nodes, including Intel 7. Zinsner said "almost all" of the Q4 impact relates to 10nm server products. That covers more than old stock: Intel's current Xeon 6 processors use compute tiles made on Intel 3, but their I/O dies are still fabbed on Intel 7, and Intel continues to sell Intel 7-based Xeon 5 Emerald Rapids chips.
Intel runs other 10nm-capable sites, including Fab 12, 22, 32 and 42 in Arizona. Server demand is so strong right now that those fabs cannot absorb the lost output, and moving qualified production between sites costs more time than waiting for Fab 28 to restart.
Could it touch gaming CPUs?
Intel 7 is also the node behind 12th, 13th and 14th Gen Core desktop chips, including the Raptor Lake parts that still sit in a huge number of gaming PCs. Intel has not said whether Fab 28 produces any of them, so a knock-on effect on consumer CPU supply is possible but unconfirmed. Players shopping for a Core i5 or i7 in the coming months should watch for stock gaps rather than assume them.
The next hard numbers arrive with Intel's fourth-quarter results in early 2027, when the real cost of the shutdown will show up in the books.
Source: Tom's Hardware; TechPowerUp; Intel Q3 2026 earnings call.
