Elon Musk Confirms Samsung Partnership For Production Of Tesla's AI6 Chip

Elon Musk, CEO of Tesla, has said Samsung Electronics will manufacture the US electric vehicle maker's next-generation AI6 chip at its semiconductor plant in the state of Texas.

Musk made the announcement on Sunday (U.S. time) on his social media platform X, formerly known as Twitter, stating, "The strategic importance of this is hard to overstate.”

He added that Taiwan Semiconductor Manufacturing Company (TSMC), which has just completed its design phase, will initially produce the AI5 chip in Taiwan, reports Yonhap news agency.

Musk also said Samsung, which currently manufactures the AI4 chip, has agreed to allow Tesla to collaborate in efforts to maximise manufacturing efficiency.

Tesla's AI6 chip is designed to be scalable -- small enough for use in humanoid robots and self-driving cars but powerful enough for artificial intelligence (AI) data centre.

Samsung Electronics said on Monday it has secured a 22.8 trillion-won (US$16.4 billion) order to supply semiconductors to a major undisclosed customer. In a regulatory filing, the South Korean tech giant said it signed a foundry contract set to be completed by December 31, 2033.

The contract accounts for 7.6 percent of the company's total revenue of 300.9 trillion won last year and marks the largest chip order ever won by Samsung Electronics.

The deal is expected to give a much-needed boost to its foundry division, which has long struggled to catch up with global industry leader Taiwan Semiconductor Manufacturing Company (TSMC).

In its earnings guideline released earlier this month, Samsung Electronics estimated an operating profit of 4.59 trillion won and sales of 74 trillion won for the second quarter.

In particular, operating profit failed to meet market expectations, mainly due to the sluggish performance of the foundry and the System Large Scale Integration (LSI) divisions, according to the report.