Tesla is getting closer to having its own chip for handling autonomous driving tasks in its cars.
The carmaker has received back samples of the first implementation of its processor and is now running tests on it, said a source familiar with the matter.
The effort to build its own chip is in line with Tesla's push to be vertically integrated and decrease reliance on other companies.
But Tesla isn't completely going it alone in chip development, according to the source, and will build on top of AMD intellectual property.
AMD shares spiked after CNBC reported that the company is working with Tesla. Shares of the stock ended the day nearly 5 percent higher and continued to climb after hours.
On Wednesday Sanjay Jha, CEO of AMD spin-off and chip fabricator GlobalFoundries, said at the company's technology conference in Santa Clara, California, mentioned Tesla as an example of companies that were working with fabricators. GlobalFoundries, which fabricates chips, has a wafer supply agreement in place with AMD through 2020.
In a statement, GlobalFoundries said Jha's remarks were misreported, and denied that the company was working directly with Tesla. AMD and Tesla declined to comment.
A more power-efficient purpose-built chip could help Tesla get closer to delivering totally autonomous driving. Tesla CEO Elon Musk promised this year that capability will be available to consumers in 2019.
Tesla's silicon project is bounding ahead under the leadership of longtime chip architect Jim Keller, the head of Autopilot hardware and software since the departure of Apple veteran Chris Lattner in June. Keller, 57, joined Tesla in early 2016 following two stints at AMD and one at Apple. Keller arrived at Apple in 2008 through its acquisition of Palo Alto Semiconductor and was the designer of Apple's A4 and A5 iPhone chips, among other things.