Samsung wins $16 billion AI chip order for Tesla

On July 28, South Korea's largest electronics company Samsung Electronics said it had won an order worth 22.8 trillion won (about 16.4 billion USD) to supply artificial intelligence (AI) chips to US technology giant Tesla.

According to a VNA reporter in Korea, in the documents submitted to the management agency, Samsung Electronics said it had signed a contract with a term until December 31, 2033.

The contract accounts for 7.6 percent of Samsung Electronics' total revenue of 300.9 trillion won last year and is the largest chip order the group has ever secured.

On the same day, on his social media account, Tesla founder - billionaire Elon Musk - also announced that Samsung Electronics will produce Tesla's next generation AI6 chip at its new semiconductor factory in the US state of Texas.

Mr Musk added that Samsung has agreed to allow Tesla to help maximize production efficiency, with Samsung's new giant factory in Texas being dedicated to producing Tesla's next-generation AI6 chips.

The Samsung plant, built in Taylor, is part of a $37 billion investment plan and is expected to be operational next year. The project has previously been delayed due to a lack of customers.

Tesla is currently accelerating the development of its fully autonomous driving (FSD) system using AI4, AI5, and AI6 chips.

According to billionaire Musk, Samsung Electronics is producing AI4 chips, while its rival Taiwan Semiconductor Manufacturing (TSMC, China) is producing AI5 chips.

Samsung's new 22.8 trillion won deal is expected to give a major boost to the company, which has long struggled to compete with world- leading chipmaker TSMC.

According to recent data from market research firm TrendForce, Samsung Electronics accounted for 7.7% of the global chip foundry market in the first quarter of this year, far behind TSMC with 67.7%.

In its earnings report released earlier this month, Samsung Electronics estimated a profit of 4.59 trillion won and sales of 74 trillion won in the second quarter, falling short of market expectations.

Following the announcement of the new deal with Tesla, Samsung Electronics shares rose 6.83% to close at 70,400 won, outpacing the 0.42% gain of the Korea Composite Stock Price Index (KOSPI)./.

(TTXVN/Vietnam+)

Source: https://www.vietnamplus.vn/samsung-gianh-don-hang-cung-cap-chip-ai-hon-16-ty-usd-cho-tesla-post1052378.vnp