What You Need to Know
-
Tesla has signed a monumental $16.5 billion agreement with Samsung to produce its next-gen chips.
-
The new chips will be made in Texas, enhancing AI capabilities for Tesla’s vehicles and personal robots.
-
Despite this exciting news, Tesla is facing some tough challenges, with a noticeable drop in sales worldwide.
Tesla’s(NASDAQ: TSLA) stock rallied higher on Monday, ending the day with a 3% increase, bouncing back from an impressive peak of 4.6% earlier. Much of this surge coincides with an overall stable S&P 500 and a minor uptick in the Nasdaq Composite(NASDAQINDEX: ^IXIC).
This exciting movement follows Tesla locking in a significant partnership with Samsung, centered around the production of next-generation AI6 chips.
Curious where to invest $1,000 right now? Our team’s analysts believe they’ve uncovered the top 10 stocks worth adding to your portfolio.Learn more >
Tesla and Samsung Join Forces
The newly formed relationship between Tesla and Samsung will see the South Korean tech leader manufacture chips at a new site in Texas.
According to CEO Elon Musk on X, not only will Samsung produce the chips, but they’ve also agreed to let Tesla help streamline the manufacturing process. Musk hinted, “The $16.5 billion figure is just the starting point. Actual production will likely exceed expectations considerably.”
While it might take years before the first AI6 chips—aimed at utilizing AI features in Tesla’s vehicles and personal robotics—hit the shelves, this promising news has been enough to push Tesla’s stock up.
Critical Phase for Tesla
This deal is meant to get Tesla closer to realizing its ambitious goals, however, the reality isn’t all sunshine and rainbows. In the short term, the carmaker is really under the gun.
Tesla’s facing fierce competition from Chinese EV giants like BYD, resulting in a sharp decline in global sales. Musk’s recent engagements in politics have also proven damaging to the Tesla brand image. The next 12 months will be crucial to see if Tesla can regain its momentum, and there are skeptics wondering if the stock is merely over-inflated.
Your Second Chance at Investment
Ever felt like you’ve missed a promising investment opportunity? You won’t want to skip this!
Our expert team occasionally delivers a “Double Down” stock recommendation for companies they predict will break out. If you think you’ve lost your chance to invest, now’s the time to jump in before it slips away. The stats don’t lie:
- Nvidia: Invest $1,000 in 2009? You’d now have $449,961!
- Apple: $1,000 in 2008? That would convert to $40,603!
- Netflix: In 2004, if you put down $1,000, it would be worth $636,628!
Don’t wait—our analysts have identified 3 outstanding companies for their next “Double Down” alerts, available with an Stock Advisor subscription. You won’t want to miss out.
Discover the top 3 stocks >
*Figures reflect Stock Advisor returns as of July 28, 2025.
Johnny Rice has no positions in any stocks mentioned. The Motley Fool has positions in and recommends Tesla. They also recommend BYD Company. Check out their disclosure policy.
