Samsung Electronics has landed a $16.5 billion deal to manufacture AI chips for Tesla, marking a major victory for its struggling foundry division. The agreement, worth 22.8 trillion won, will run through 2033 and centers on producing Tesla’s AI6 chip at Samsung’s upcoming plant in Taylor, Texas.
Tesla CEO Elon Musk confirmed the news on X, calling the deal “just the bare minimum” and hinting that actual production may far exceed expectations. He also revealed he will personally help optimize the chip fabrication process. These next-gen chips will power Tesla’s future self-driving systems. Samsung already produces Tesla’s current AI4 chips.
Following the announcement, Samsung’s shares surged 6.8% to their highest level since September, while suppliers like Soulbrain jumped as much as 16%. The win also comes after Samsung Executive Chairman Jay Y. Lee was recently cleared of all legal charges, giving the company fresh momentum.
Samsung’s foundry unit has been struggling with under-utilization and delays, particularly in launching its Texas facility, now pushed to 2026. This Tesla contract could significantly improve its outlook. Analysts say the deal may boost Samsung’s foundry sales by up to 10% annually and help attract more high-profile clients.
By comparison, market leader TSMC holds nearly 68% of global foundry share, with Samsung at just 7.7%. Both firms are racing to develop advanced 2-nanometer chip technology, and this deal signals renewed confidence in Samsung’s capabilities.