Tesla taps Samsung for AI6 Chips in $16.5 billion deal
Samsung said Monday it had secured an eight-year agreement, without naming the client, describing it only as a "major global company" in a regulatory filing.
Under the deal, the partnership -- effective from last Thursday -- runs through the end of 2033.
"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 on X.
"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".
The deal represents about 7.6 percent of Samsung's projected annual sales for 2024, the company said.
It declined to confirm the client was Tesla, even after Musk's message, citing confidentiality.
The agreement is expected to provide a major boost to Samsung, which has faced headwinds in its foundry business, lagging rivals SK hynix and Taiwan's TSMC in the race for cutting-edge artificial intelligence chips.
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.
The company said this month that it expected operating profit to fall 56 percent on-year and 31 percent from the previous quarter, citing a slump in its core semiconductor division.
Experts have attributed the decline to weaknesses in its foundry operations, which involve contract-based manufacturing of chips designed by other companies.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Times of Oman
5 hours ago
- Times of Oman
China hits back at US over tariff threats, says "coercion, pressuring will not achieve anything"
Beijing: China on Wednesday responded strongly to the US suggestion that it will significantly raise tariffs if China continues to purchase Russian oil, saying "coercion and pressuring will not achieve anything." "Response to US suggestion that it will significantly raise tariffs if China continues to purchase Russian oil: China will always ensure its energy supply in ways that serve our national interests," Chinese foreign ministry spokesperson Guo Jiakun wrote on X. "Tariff wars have no winners. Coercion and pressuring will not achieve anything. China will firmly defend its sovereignty, security and development interests," the Chinese spokesperson said. On Tuesday, US Treasury Secretary Scott Bessent said he had warned Chinese officials that continued purchases of sanctioned Russian oil would lead to significant tariffs due to legislation in Congress, but was told that Beijing would protect its energy sovereignty, The Straits Times reported. Wrapping up two days of US-China trade talks in Stockholm, Bessent said he also expressed US displeasure at China's continued purchases of sanctioned Iranian oil, and its sales of over USD 15 billion worth of dual-use technology goods to Russia that have bolstered Moscow's war against Ukraine, the Singapore-based news outlet reported. Bessent said legislation in the US Congress authorising Trump to levy tariffs up to 500 per cent on countries that purchase sanctioned Russian oil would draw US allies into taking similar steps to cut off Russia's energy revenues, as per The Straits Times. This comes after US President Donald Trump's decision on Monday to shorten the 50-day deadline given to Russian President Vladimir Putin, setting a new deadline of 10 to 12 days to reach a peace deal with Ukraine. Speaking to reporters alongside UK Prime Minister Keir Starmer from his golf resort in Turnberry, Scotland, Trump stated that, "I'm going to make a new deadline of about 10 or 12 days from today. There's no reason in waiting," adding that "I want to be generous, but we just don't see any progress being made." Trump emphasised that he doesn't want to impose harsh measures on Russia, but he's willing to do so if necessary. "It would be sanctions and maybe tariffs, secondary tariffs. I don't want to do that to Russia," he said.
Times of Oman
a day ago
- Times of Oman
Deals working out very well: Trump on India-US trade deal, hints at 20-25 per cent tariff
Washington: Just days ahead of the self-imposed August 1 deadline date before the tariffs come into effect, US President Donald Trump stated that the India-US trade deal was "working out very well" but hinted at a 20 per cent to 25 per cent tariff on New Delhi. During a gaggle with the press interaction aboard Air Force One on Tuesday (local time), Trump responded to a report suggesting that India might be preparing for 20 to 25 per cent tariffs, stating that India had been imposing higher tariffs on the US as compared to other countries. He further mentioned that all this would come to an end as he is now "in charge." However, Trump hasn't sent any letters to India announcing the tariff imposed on New Delhi, as he did for many other nations. "India has been a good friend. But India has charged basically more tariffs than almost any other country over the years. But now I'm in charge. And you just can't do that. I think the trade deals are working out very well. Hopefully for everybody, but for the United States, they're very, very good," the US President said. Earlier on April 22, Trump imposed a tariff of 26 per cent on Indian goods imported to the US, before announcing a pause on those "reciprocal" levies. Meanwhile, the Union Minister for Commerce, Piyush Goyal, on Sunday, stated that the trade discussion between India and the US had been going "very well." "India today negotiates from a position of strength, a position of confidence. It is this very confidence that continuously encourages us to make good free trade agreements... Our discussions with the United States are progressing very well," he stated. Foreign Secretary Vikram Misri, during PM Modi's visit to the UK last week, also stated that India had been actively engaged in discussions with the US on a potential Bilateral Trade Agreement (BTA), emphasising the ongoing contacts with partners in the US. During a press conference following the signing of the India-UK Free Trade Agreement, Misri stated, "We are discussing that under a different vertical. All I can say is that our engagement is underway. The contacts are underway, and we'll see how that goes." On July 14, a senior government official stated that India was making concrete progress toward finalising a BTA with the US, with both countries committed to following the path outlined by their respective leaders. Speaking on the ongoing trade negotiations, the official emphasised that India is "moving in terms of a BTA" and actively "looking at a mutually beneficial deal" that would serve the interests of both nations. Trump also used the opportunity to once again claim credit for his role in brokering the ceasefire agreement between India and Pakistan, following the recent conflict in May. The conflict was triggered by the April 22 Pahalgam terror attacks, which killed 26 people, and India's subsequent response, 'Operation Sindoor,' involving precision strikes on nine terror camps in Pakistan and Pakistan-occupied Jammu and Kashmir (PoJK). He also praised India's leadership under Prime Minister Narendra Modi for its role in regional stability. "Look, India, they're my friends and he's (PM Modi) my friend and you know they ended the war with Pakistan and by request and I was great and Pakistan did also. We did a lot of great settlements," he said. India had reportedly refuted the claims made by the US president, noting that it was Pakistan's Director General of Military Operations (DGMO) who contacted their Indian counterpart to request an end to hostilities, following which the ceasefire was then agreed upon.
Observer
3 days ago
- Observer
Tesla taps Samsung for AI6 Chips in $16.5 billion deal
Seoul - Tesla CEO Elon Musk said Monday that tech giant Samsung Electronics will provide his company with its next-generation AI6 chips, following the South Korean firm's announcement of a US$16.5 billion deal. Samsung said Monday it had secured an eight-year agreement, without naming the client, describing it only as a "major global company" in a regulatory filing. Under the deal, the partnership -- effective from last Thursday -- runs through the end of 2033. "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 on X. "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". The deal represents about 7.6 percent of Samsung's projected annual sales for 2024, the company said. It declined to confirm the client was Tesla, even after Musk's message, citing confidentiality. The agreement is expected to provide a major boost to Samsung, which has faced headwinds in its foundry business, lagging rivals SK hynix and Taiwan's TSMC in the race for cutting-edge artificial intelligence chips. 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. The company said this month that it expected operating profit to fall 56 percent on-year and 31 percent from the previous quarter, citing a slump in its core semiconductor division. Experts have attributed the decline to weaknesses in its foundry operations, which involve contract-based manufacturing of chips designed by other companies.
