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The Hill
38 minutes ago
- Automotive
- The Hill
Musk touts Tesla chip deal with Samsung
Technology The Big Story Musk: New Samsung plant will make Tesla AI chips Tesla CEO Elon Musk said a new Samsung plant in Texas will be devoted to making the next generation of semiconductors for the electric vehicle (EV) company as it pushes the needle on artificial intelligence (AI). In a Sunday post on X, the social media platform he purchased in 2022, Musk said Samsung's new factory will be 'dedicated' to making Tesla's AI6 chip. Musk said he will also be a presence at the factory to 'assist' Samsung 'in maximizing manufacturing efficiency.' 'This is a critical point, as I will walk the line personally to accelerate the pace of progress. And the fab is conveniently located not far from my house,' Musk wrote. The Hill has reached out to Samsung for comment. The value of the contract is $16.5 billion, according to CNBC. Tesla's deal with Samsung could be a major lift for the embattled EV company as it attempts to overcome a serious dip in sales, spurred largely by Musk's brief alliance with President Trump. Tesla's global sales sunk throughout 2025 as Musk led Trump's Department of Government Efficiency cost-cutting panel. He also spurred backlash to Tesla in Europe by aligning himself with far-right political figures and attacking Ukrainian President Volodymyr Zelensky. Welcome to The Hill's Technology newsletter, I'm Julia Shapero — tracking the latest moves from Capitol Hill to Silicon Valley. Did someone forward you this newsletter? Subscribe here. Essential Reads How policy will be impacting the tech sector now and in the future: Democrats blast Lutnick for reversal on China, semiconductors A group of congressional Democrats blasted the Trump administration's decision to allow advanced computer chips made by Nvidia to be sold in China, in a set of letters sent to Commerce Secretary Howard Lutnick. In a letter to Lutnick on Sunday, Reps. Raja Krishnamoorthi (D-Ill.) and Gregory Meeks (D-N.Y.) said the administration was using export controls on semiconductors and advanced computer parts as a 'bargaining chip,' … Full Story Warren wants answers from Social Security chief on phone wait times Sen. Elizabeth Warren (D-Mass.) is asking Social Security Administration (SSA) Commissioner Frank Bisignano to provide additional information about the wait times for phone calls, amid reports of discrepancies in data. In a letter sent Sunday evening to Bisignano, provided exclusively to The Hill, Warren followed up on her meeting with the SSA chief Wednesday, when, the senator said, she secured a commitment from Bisignano … Full Story Lutnick says tariffs set in place Aug 1: 'No extensions. No more grace periods.' Commerce Secretary Howard Lutnick said on Sunday that President Trump would not grant any further extensions to countries wishing to negotiate trade deals ahead of the Aug. 1 deadline. 'No extensions, no more grace periods. Aug. 1, the tariffs are set,' Lutnick said in an interview on 'Fox News Sunday.' 'They'll go into place, customs will start collecting the money, and off we go,' Lutnick continued. Lutnick added, however, … Full Story Op-eds in The Hill Opinions related to tech submitted to The Hill: Watch out, Google: Trump should move online in his fight against left-wing bias SpaceX is getting into the cosmic manufacturing business The fight to preserve state AI regulation and protect children isn't over
Qatar Tribune
an hour ago
- Automotive
- Qatar Tribune
Tesla signs $16.5B next-gen chip supply deal with Samsung: Musk
Agencies Tesla has signed a $16.5 billion deal with Samsung to source next-generation AI6 chips, CEO Elon Musk said on Monday, a move expected to bolster the South Korean tech giant's loss-making contract manufacturing business. Samsung shares rose more than 6% after the news. 'Samsung's giant new Texas fab will be dedicated to making Tesla's next-generation AI6 chip. The strategic importance of this is hard to overstate,' Musk said in a post on his social media platform X. If Musk was referring to Samsung's upcoming Taylor, Texas, plant, the deal could revive the project that has faced delays amid Samsung's struggles to retain and win major customers. 'Samsung agreed to allow Tesla to assist in maximizing manufacturing efficiency,' he added, calling it a 'critical point' in striking the deal. 'I will walk the line personally to accelerate the pace of progress,' he said, noting Samsung's Texas plant was 'conveniently located not far from my house.' While no timeline was provided for AI6 chip production, Musk has previously said that next-generation A15 chips will be produced at the end of 2026, suggesting A16 would follow. Samsung currently makes Tesla's A14 chips, which power its Full Self-Driving driver assistant system, while TSMC will make the AI5 initially in Taiwan and then Arizona, Musk has said. Texas project In October, Samsung had postponed taking deliveries of ASML chipmaking equipment for its factory in Texas as it had not yet won any major customers for the project, Reuters reported. It has already delayed the plant's operational start to 2026. Samsung, the world's top memory chip maker, also produces logic chips designed by customers through its foundry business. The Texas project is central to Samsung Chairman Jay Y. Lee's strategy to expand beyond its bread-and-butter memory chips into contract chip manufacturing. Samsung currently trails a distant second in the global foundry market, with an 8% share versus leader TSMC's 67% share, data from market researcher Trendforce show. Samsung had earlier announced the $16.5 billion chip supply deal without naming the client, saying the customer had requested confidentiality about the details of the deal, which will run through the end of 2033. The deal represents about 7.6% of Samsung's projected annual sales for 2024, the company said. The news comes as Samsung, which is due to report its earnings on Thursday, faces mounting pressure in the race to produce artificial intelligence chips, where it trails rivals such as TSMC and SK Hynix. This lag has weighed heavily on its profits and share price. Pak Yuak, an analyst at Kiwoom Securities, said the deal would help reduce losses at Samsung's foundry business, which he estimated exceeded 5 trillion won ($3.6 billion) in the first half of the year. Analysts say Samsung has struggled with the defection of key clients to TSMC for advanced chips. TSMC counts Apple, Nvidia and Qualcomm among its customers. It is not clear whether the Samsung-Tesla deal is related to ongoing trade talks between Korea and the United States. Seoul is seeking U.S. partnerships in chips and shipbuilding amid last-ditch efforts to reach a trade deal to eliminate or reduce potential 25% U.S. tariffs. Samsung has been losing market share to TSMC in contract manufacturing, underscoring technological challenges the firm faces in mastering advanced chip manufacturing to attract clients like Apple and Nvidia, analysts said. Samsung Electronics is the flagship unit of South Korea's Samsung Group, by far the largest of the family-run conglomerates that dominate Asia's fourth-largest economy.
Kuwait Times
3 hours ago
- Automotive
- Kuwait Times
Tesla signs $16.5bn chip supply deal with Samsung
SEOUL: Tesla CEO Elon Musk said the US automaker had signed a $16.5 billion deal to source chips from Samsung Electronics, a move expected to bolster the South Korean tech giant's loss-making contract manufacturing business. Samsung shares soared nearly 7 percent after news of the deal on Monday which comes as the world's top memory chip maker faces mounting pressure in the race to produce artificial intelligence chips, where it trails rivals such as TSMC and SK Hynix. Musk said Samsung's new chip factory in Taylor, Texas will make Tesla's next-generation AI6 chip, potentially re-energizing the project that has faced long delays amid Samsung's difficulties in retaining and attracting major clients. 'Samsung agreed to allow Tesla to assist in maximizing manufacturing efficiency. This is a critical point, as I will walk the line personally to accelerate the pace of progress. And the fab is conveniently located not far from my house,' Musk said in a post on X on Monday. 'The $16.5B number is just the bare minimum. Actual output is likely to be several times higher,' he said in another post. Shares of Samsung jumped 6.8 percent to their highest since September last year, while Tesla shares were up 1.9 percent in US pre-market trading. According to a senior analyst at NH Investment & Securities, Ryu Young-ho, Samsung's Taylor fab 'so far had virtually no customers, so this order is quite meaningful,' although the deal may represent a small portion of its logic chip revenue annually. In October, Reuters reported that Samsung had postponed taking deliveries of ASML chipmaking equipment for its Texas factory as it had not yet won any major customers for the project. It has already delayed the plant's operational start to 2026. It is not clear whether the Samsung-Tesla deal is related to ongoing trade talks between South Korea and the United States. Seoul is seeking US partnerships in chips and shipbuilding amid last-ditch efforts to reach a trade deal to eliminate or reduce potential 25 percent US tariffs. A South Korean trade ministry official told Reuters he had not heard that the specific deal was part of the trade negotiations. While no timeline was provided for AI6 chip production, Musk has previously said that next-generation AI5 chips will be produced at the end of 2026, suggesting AI6 would follow. Lee Dong-ju, an analyst at SK Securities, expects production in 2027 or 2028, but Tesla has a history of missing its targets. Samsung currently makes Tesla's AI4 chips, which power its Full Self-Driving driver assistant system, while TSMC is slated to make the AI5, initially in Taiwan and then Arizona, Musk has said. Samsung, the world's top memory chip maker, also produces logic chips designed by customers through its foundry business. The Texas project is central to Samsung Chairman Jay Y. Lee's strategy to expand beyond its bread-and-butter memory chips into contract chip manufacturing. It holds just 8 percent of the global foundry market, far behind industry leader TSMC, which has a 67 percent share, data from market researcher Trendforce show. Samsung had earlier announced the $16.5 billion chip supply deal without naming the client, saying the customer had requested confidentiality about the details of the deal, which will run through the end of 2033. Three sources briefed about the matter told Reuters that Tesla was the customer for the deal. Help Samsung's foundry business The deal with Tesla comes as Samsung, which is due to report its earnings on Thursday, faces mounting pressure in the race to produce artificial intelligence chips, where it trails rivals such as TSMC and SK Hynix. This lag has weighed heavily on its profit and share price. Earlier this month, Samsung projected a 56 percent drop in second-quarter operating profit, partly due to widening losses of its foundry business. Pak Yuak, an analyst at Kiwoom Securities, said the deal would help reduce losses at Samsung's foundry business, which he estimates exceeded 5 trillion won ($3.6 billion) in the first half of the year. Analysts say Samsung has struggled to retain key clients, with many defecting to TSMC for advanced chips, underscoring technological challenges the firm faces in the race to stay relevant in the capital-intensive business. TSMC counts Apple, Nvidia and Qualcomm among its customers. - Reuters
Axios
4 hours ago
- Automotive
- Axios
Central Texas' car and chip nexus
Cementing Central Texa s as a global leader in chips and car technology, Tesla has signed a deal to obtain semiconductor chips from the Samsung factory in Taylor. Why it matters: The deal gives the Austin-based car company a steady supply of critical technology — and furnishes Samsung with the big dependable customer it had been seeking. The chip manufacturer had paused construction on its massive Taylor plant — due to open next year — as it sought a buyer for its chips, Nikkei Asia reported in early July. Taylor is 30 miles northeast of Austin. The big picture: Samsung announced Saturday that it had struck a $16.5 billion supply agreement, but it didn't identify the company. The announcement comes after Samsung, one of the world's largest memory chip makers, acknowledged last year that it had fallen behind in the AI chips war. Driving the news: "Samsung's giant new Texas fab will be dedicated to making Tesla's next-generation AI6 chip," Tesla CEO Elon Musk then revealed on his platform X late Sunday. "The strategic importance of this is hard to overstate." The intrigue: "Samsung agreed to allow Tesla to assist in maximizing manufacturing efficiency. This is a critical point, as I will walk the line personally to accelerate the pace of progress," Musk wrote. "And the fab is conveniently located not far from my house." What they're saying: Ryu Young-ho, a senior analyst at NH Investment and Securities, said that Samsung's Taylor factory "so far had virtually no customers, so this order is quite meaningful," Reuters reported.
Yahoo
5 hours ago
- Automotive
- Yahoo
Tesla (TSLA) Stock Is Up, What You Need To Know
What Happened? Shares of electric vehicle pioneer Tesla (NASDAQ:TSLA) jumped 4% in the afternoon session after the company announced a significant, multi-billion dollar contract with Samsung Electronics to produce its next-generation AI chips. The deal, valued at approximately $16.5 billion, secured a long-term supply of semiconductors for Tesla through the end of 2033. Tesla CEO Elon Musk confirmed the partnership, stating that Samsung's new factory in Texas would be dedicated to manufacturing Tesla's next-generation "AI6" chip. These advanced chips were designed to power key future products, including the company's humanoid robots and self-driving vehicle technology. The news helped the stock recover after the company reported disappointing second-quarter financial results. After the initial pop the shares cooled down to $327.00, up 3.4% from previous close. Is now the time to buy Tesla? Access our full analysis report here, it's free. What Is The Market Telling Us Tesla's shares are extremely volatile and have had 49 moves greater than 5% over the last year. In that context, today's move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business. The previous big move we wrote about was 3 days ago when the stock gained 3.9% as CEO Elon Musk backed a claim that the company could reach a staggering $20 trillion valuation. The comment, in which Musk stated that 'extreme execution is needed, but a valuation of $20 trillion for Tesla is possible,' came after the stock tumbled nearly 9% in the prior session. The previous day's decline followed the company's second-quarter earnings report, which revealed a 12% year-over-year drop in revenue, its sharpest decline in over a decade. Despite the recent disappointing results and concerns over short-term growth, Musk's bullish long-term forecast for Tesla's potential in AI, robotics, and autonomous driving appeared to resonate with investors, sparking a rebound in the share price. Separately, Business Insider reported that Tesla's robotaxi service will launch in San Francisco before the end of the week. While the initial launch is expected to include safety drivers, the mere presence of the service in a major urban center like San Francisco represents a crucial step forward in Tesla's ambitious robotaxi plans, suggesting progress in a key area of future growth. Tesla is down 13.8% since the beginning of the year, and at $327.00 per share, it is trading 31.9% below its 52-week high of $479.86 from December 2024. Investors who bought $1,000 worth of Tesla's shares 5 years ago would now be looking at an investment worth $3,322. Today's young investors likely haven't read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
