Musk says Tesla (TSLA.US) received a "considerable quota" from Micron; storage chips have become strategic resources fiercely contested by automakers amid the AI boom.

According to Zhitong Finance APP, Elon Musk stated that Micron Technology (MU.US) recently provided Tesla (TSLA.US) with a "considerable" quota of memory chips, helping the automaker meet the growing demand for this increasingly scarce commodity.

During Tesla's quarterly earnings call held on Wednesday, Musk said that Micron offered Tesla very reasonable supply conditions at a time when memory chips are in short supply and prices are high.

The global rise of artificial intelligence (AI) systems has driven up the demand for memory chips, which help computers store and manage data. This frenzy has triggered a broader shortage, affecting other industries, pushing up prices, and putting pressure on production.

In the long term, Musk is committed to in-house semiconductor manufacturing. The billionaire has launched an ambitious project called Terafab, aiming to produce computing and memory chips at an unprecedented scale. The project is jointly undertaken by Tesla and SpaceX, both of which Musk serves as CEO.

The latest announced results show that continued investment in AI and robotics has put pressure on the company's profitability, causing its net profit, earnings per share, and gross margin to all fall short of Wall Street expectations. Free cash flow has also turned negative.

The financial report shows that Tesla’s adjusted earnings per share (EPS) in the second quarter were $0.33, below the market expectation of $0.51. Free cash flow turned negative at $1.1 billion, compared with a positive $146 million in the same period last year, and $1.44 billion in the first quarter of this year.

However, the company said it would continue to maintain a robust balance sheet and sufficient liquidity to support future product roadmaps, long-term capacity expansion plans (including further vertical integration), and funding needs.

For now, Tesla still needs Micron—and it does not have the buying power that some other customers possess. According to compiled data, as the largest memory chip manufacturer in the United States, Micron's top ten customers do not include Tesla or SpaceX.