Latest news with #A16
Qatar Tribune
a day 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.
Engadget
a day ago
- Automotive
- Engadget
Samsung wins $16.5 billion deal to make Tesla's A16 chips
Samsung will make Tesla's A16 chip in a deal worth 22.8 trillion won ($16.5 billion). The chip manufacturer had filed a regulatory contract with an unnamed entity, but Elon Musk announced Tesla as the other party on X (formerly Twitter). The deal will run through 2033 and utilize an upcoming plant in Taylor, Texas. Musk stated, "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." This agreement marks a significant turnaround for Samsung, which, earlier this month, pushed back opening the Texas factory until 2026 due to a lack of customers. Samsung currently produces the A14 chips that power Tesla's Full Self-Driving platform. However, the A15 contract went to one of its biggest competitors, Taiwan Semiconductor Manufacturing Company (TSMC). According to Musk, that design has just been completed. The new deal doesn't come without strings — namely a lot of Musk breathing over the manufacturer's shoulder. "Samsung agreed to allow Tesla to assist in maximizing manufacturing efficiency," Musk stated in a subsequent X post. "This is a critical point, as I will walk the line personally to accelerate the pace of progress." He went so far as to point out that the fabrication facility isn't far from his Austin, Texas home. If you buy something through a link in this article, we may earn commission.
United News of India
2 days ago
- Automotive
- United News of India
Samsung and Tesla enter into strategic deal for chip manufacturing
New Delhi, July 28 (UNI) Samsung Electronics & Co., a prominent South Korean chipmaker, has signed a deal worth USD16.5 billion with Tesla Inc. This major agreement raised a wave of hope and momentum for Samsung's lagging chip foundry business. Reportedly, the agreement will be viable until 2033. Initially, the news came out through the regulatory filing by Samsung, which was discovered, but after some hours, CEO Elon Musk posted on the social media platform X, ' Samsung agreed to allow Tesla to coordinate in driving the manufacturing efficiency, citing it as a critical point.' Musk also stated that Samsung's new Texas fab will be dedicated to the generation of Tesla's next-gen A16 chips. Mush also stressed the great strategic importance of this decision. 'I will walk the line personally to accelerate the pace of progress, and the fab is located near my house,' Musk added. The news brought an optimistic trend in Samsung's shares as the company's share rose to about 3.5 per cent on the Seoul Stock Exchange on Monday. It marks the biggest single-day jump in shares. This deal also comes amid Samsung's chip foundry business, which is facing heavy competition from rivals like Taiwan's TSMC (Taiwan Semiconductor Manufacturing Company) and SK Hynix. Reportedly, Taiwan's TSMC is currently dominating the chip market due to its focus on research and intense efficiency. UNI SAS PRS
Hindustan Times
2 days ago
- Automotive
- Hindustan Times
Elon Musk says Tesla, Samsung sign $16.5 billion chip supply deal
Tesla CEO Elon Musk said the U.S. 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. Elon Musk, Chief Executive Officer of SpaceX and Tesla and owner of Twitter, gestures as he attends the Viva Technology conference dedicated to innovation and startups at the Porte de Versailles exhibition centre in Paris, France, June 16, 2023.(Reuters) Samsung's shares jumped as much as 6.8% to their highest since September last year after news of the deal. 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. 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". 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. POTENTIAL PRODUCTION TIMELINE 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. 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 A14 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. Samsung currently holds just 8% of the global foundry market, far behind industry leader TSMC, which has a 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. 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 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 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. 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 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.
Time of India
2 days ago
- Automotive
- Time of India
Tesla signs chip deal with Samsung, Elon Musk says: Samsung agreed to allow ...
Elon Musk's Tesla has inked a major deal with Samsung Electronics. The Elon Musk's company has inked a major chip supply agreement with Samsung. The deal is reportedly worth $16.5 billion and is set ti run through the end of 2033. The announcement was confirmed by Tesla CEO Elon Musk, who said Samsung had agreed to allow 'full customisation of Tesla-designed chips'. Along with this, Musk also revealed that Samsung's latest Texas fabrication plant would be dedicated to producing Tesla's next-generation A16 chipset. This deal with Tesla marks as a crucial win for Samsung as the company was reportedly struggling with losses and stiff competition. Elon Musk confirms Tesla's chip deal with Samsung Tesla CEO Elon Musk recently confirmed that the company has signed a deal with Samsung for complete customisation of Tesla-designed chips. Musk confirmed the deal with a post on social media platform X (formerly known as Twitter). 'Samsung agreed to allow Tesla to assist in maximising 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,' wrote Musk. Tesla CEO also confirmed that Samsung will manufacture Tesla'a next-generation A16 chipset at news Texas fabrication. Presently Samsung makes A14 chip for Tesla, whereas TSMC will manufacture the A15 chipset in Taiwan and Arizona. '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. Samsung currently makes AI4. TSMC will make AI5, which just finished design, initially in Taiwan and then Arizona,' added Musk. Why is the deal important for Samsung and Tesla The deal said to be an important win for Samsung's contract chip-making business, which has been struggling to compete with rivals like TSMC. As per the analyst, the partnership is said to help Samsung in reducing the loses in its foundry division which reportedly exceeded $3.6 million in the first half of 2025. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Brain tumor has left my son feeling miserable; please help! Donate For Health Donate Now Undo On the other hand, for Tesla the deal means a continuous supply of custom logic chips made for its evolving AI stack. The deal also carries broader geopolitical implications, strengthening technology ties between South Korea and the United States, particularly amidst ongoing trade discussions and potential US tariffs. AI Masterclass for Students. Upskill Young Ones Today!– Join Now
