Tesla stock advanced higher during Monday's stock market after CEO Elon Musk confirmed late Sunday that the EV giant has signed a $16.5 billion, multiyear, deal with Samsung for AI chips. Musk claimed that the initial price tag on the deal is just the beginning.
The Tesla head said on X that Samsung's new Texas fab facility will be "dedicated to making Tesla's next-generation AI6 chip" with the aim of using the new memory chips for Tesla's humanoid robot Optimus, fully autonomous self-driving vehicles and AI data centers.
"The strategic importance of this is hard to overstate," Musk said Sunday. "Samsung agreed to allow Tesla to assist in maximizing manufacturing efficiency. This is a critical point, as I will walk the line personally to accelerate the pace of progress. And the fab is conveniently located not far from my house."
Separately, Samsung did not identify the client, but said the deal, equivalent to nearly 8% of its 2024 revenue, runs through 2033.
While the initial deal is valued at around $16.5 billion, Musk added on X Sunday that the total amount is "likely much more than that."
Find The Next Palantir Or Hot IPO Stock With This Tool
In stock market action, Tesla stock gained more than 3% to 325.59 on Monday, after falling 3.5% on Friday. Overall, Tesla stock fell 4.1% to 316.06 last week as Musk warned of a "few rough quarters" ahead in the Q2 conference call.
Meanwhile, Taiwan Semiconductor declined around 1% during Monday's stock market. Intel gained a fraction Monday.
California Expansion For Robotaxi?
The Tesla robotaxi app now includes California as an option, but apparently no rides have taken place.
That followed a Friday Business Insider report that Tesla was set to launch a robotaxi service in the San Francisco Bay Area.
The Tesla app confirms reports that the robotaxis will have a safety driver, meaning it appears to simply be supervised full self-driving, similar to what current Tesla FSD owners have. That's a step down from the limited robotaxi ride-hailing service in Austin, Texas, which has safety monitors in the passenger seat ready to intervene.
Tesla has a California permit for ride-hailing but no permits for self-driving.
Business Insider on Friday reported that Tesla circulated a memo to staff that its expected robotaxi ride-hailing service expansion to San Francisco over the weekend will have a "safety monitor" in the driver's seat with full access to the brake and steering wheel.
Best IBD 50 Stocks To Watch
Tesla Stock Trend
Last week, TSLA undercut its 50-day and 200-day moving averages last week, but narrowed the gap on Friday. Tesla stock is still in a new base with a traditional 367.71 buy point, according to MarketSurge chart analysis. That base is within a much-larger consolidation.
Tesla stock rallied from late April to late May in part because Musk said he was backing away from politics and the Trump administration. Since then, Tesla stock has tumbled and rebounded according to news cycles — many generated by debate between Musk and Trump.
The stock initially soared after the robotaxi launch but Tesla stock closed Monday around 1% higher since the June 22 service release.
Stocks To Buy And Watch: Top IPOs, Big And Small Caps, Growth Stocks
At Monday's stock market close, Tesla stock was up 37% since the April 22 Q1 conference call, lifted by robotaxi bets. Shares are down about 19% for the year, and 33% below their all-time high of 488.54.
Tesla stock has a 21-day average true range of 4.14%. The ATR metric, available on IBD's MarketSurge charting tool, gauges the characteristic breadth of a stock's behavior. Stocks that tend to make large jumps or dives in daily stock market action, the kind that can trigger sell rules and shake investors out of a stock, have a high ATR. Stocks that tend to make more incremental moves have lower ATRs.
Investors can keep tabs on the IBD Leaderboard watchlist, the IBD 50 list of top growth stocks and IBD SwingTrader along with the IBD Sector Leaders list.
Tesla stock has a 51 Composite Rating out of a best-possible 99. The stock also has a 70 Relative Strength Rating and a 56 EPS Rating.
Please follow Kit Norton on X @KitNorton for more coverage.
YOU MAY ALSO LIKE:
Get Full Access To IBD Stock Lists And Ratings
Why This IBD Tool Simplifies The Search For Top Stocks
IBD Digital: Unlock IBD's Premium Lists, Tools And Analysis Today
How To Invest: Rules For When To Buy And Sell In Bull And Bear Markets
