25.07.28.Today News : Samsung Secures Record $16.5B Foundry Deal with Tesla

Samsung Secures Record $16.5B Foundry Deal with Tesla

• Samsung Electronics signs an unprecedented long-term contract with Tesla to produce next-gen AI chips using its 2nm process at its new Taylor, Texas foundry.

Samsung Electronics has secured a game-changing foundry deal worth 23 trillion KRW ($16.5 billion) with Tesla, marking the largest single contract in its semiconductor foundry history. The partnership is expected to revitalize Samsung’s struggling foundry business and enhance its technological competitiveness in the ultra-fine process market.

Samsung Electronics has signed a 23 trillion won ($23 billion) foundry contract with Tesla.

On July 28, Samsung Electronics announced a massive contract worth 22.76 trillion KRW (approximately $16.5 billion) with Tesla to manufacture next-generation chips under its foundry division. The agreement will last through December 2033, spanning over eight years, and represents the largest single foundry deal in Samsung’s history.

Under the agreement, Samsung plans to produce Tesla's next-gen AI6 chips at its upcoming foundry facility in Taylor, Texas, currently under construction with a $17 billion investment. These chips are essential to Tesla’s future self-driving platforms and will be manufactured using the cutting-edge 2nm fabrication process. Mass production is expected to commence after the factory’s completion, likely starting in 2027.

Tesla CEO Elon Musk highlighted the importance of this partnership via his social media platform X (formerly Twitter), stating, "Samsung's massive new Texas plant will be dedicated to producing Tesla's next-gen AI6 chips." He also suggested that the actual production volume could exceed the current contract, hinting at future expansion: “The $16.5 billion figure is just a baseline; actual output may be several times larger.”

The deal is especially significant given Samsung’s recent challenges in the foundry sector. Despite investing heavily in Pyeongtaek and Taylor facilities, Samsung struggled to attract major clients, delaying operations and impacting profits. In recent quarters, the foundry division reported losses exceeding 2 trillion KRW, dragging down overall earnings.

With Tesla now secured as a long-term client, Samsung expects a turnaround. The deal not only stabilizes revenues but also validates Samsung’s competitiveness in advanced semiconductor manufacturing. Experts believe that this partnership will pave the way for additional contracts with other tech giants.

Professor Lee Jong-hwan from Sangmyung University remarked, “Samsung’s capabilities from design to production were once viewed as a concern, but this partnership has alleviated those doubts. This opens the door to more deals with major global players.”

One-line summary : Samsung has secured a 23 trillion KRW foundry deal with Tesla, marking its largest-ever client contract.