Tesla's (TSLA -1.71%) biggest near-term risk lies in the two things that CEO Elon Musk believes are its biggest value-creation drivers: Cybercab/robotaxis and Optimus robots. In both cases, the company is aggressively ramping up up-front spending to support its development.
That's fine in itself, but it does expose the company to the risk of bleeding cash if robotaxi and Optimus don't generate earnings and cash flow in line with management's plans.
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Tesla's cash flow dynamics Tesla's free cash flow (FCF) is becoming a stick the bears are using to beat the stock with. The company's capital spending is set to turn it from a cash-generative company to a net user of cash, as its earnings and operating cash flow (OCF) generation fail to offset the increase in spending. The dynamics of Wall Street analysts are shown in the chart, using data courtesy of Visible Alpha.
Data source: Visible Alpha. Chart by author.
Note how OCF growth, mainly from the electric vehicle (EV) business, isn't enough to fully offset the increase in capital spending, and Wall Street expects Tesla to have cash outflows from 2026 to 2028, only to return to FCF generation in 2029 as robotaxi and Optimus revenue starts to kick in, leading to the beginning of a multiyear growth in FCF as robotaxi/Optimus generate a long-term stream of recurring income.
Based on these Wall Street projections, investors shouldn't be perturbed. After all, there's a reason for the elevated levels of capital spending, and it comes down to investing in the growth of robotaxi and Optimus, as well as substantive actions to secure and de-risk its EV and energy supply chain, such as investments in a lithium refinery, AI compute, and lithium iron phosphate (LFP) battery production.
The ultimate aim is to support long-term growth that would otherwise be threatened if these investments aren't made.
However, if there's a delay in the growth of robotaxi/Optimus revenue, there will be negative consequences for Tesla's cash flow, not least because it won't be able to significantly moderate capital spending on essential growth investments. This would put more pressure on the EV business to generate the earnings and cash flow necessary to support it, even as Tesla's focus shifts toward investment in Cybercab/robotaxi and Optimus.
Moreover, if there are significant delays in Cybercabs/robotaxis, there's likely to be a highly visible abundance of inactive Cybercabs, which represent cash usage and a drain on liquidity.
What will it mean for the investment case? Any delay to Wall Street expectations would likely pressure the stock, as investors potentially focus more on weaker FCF generation due to lower-than-expected revenue and rising capital spending.
Image source: Tesla.
That said, Tesla can still generate billions in cash from its EV and energy business, and it holds a fortress-like balance sheet. According to S&P Global Market Intelligence estimates, Tesla will end 2026 with $23 billion in net cash, so there's little risk it won't be able to fund its growth aspirations. Moreover, there's plenty of evidence that Tesla is making excellent progress on its robotaxi rollout in terms of safety.
Tesla has real potential to achieve its long-term aims. Still, investors need to take a long-term view of the stock and be prepared for any near-term volatility if Cybercab/robotaxi, in particular, is delayed. Overall, the stock remains attractive, but patience is required.
Elon Musk, the CEO of Tesla (TSLA -1.71%), is known for being a visionary. But it is important to remember that not every big idea turns into a big, profitable business. For example, the company recently stopped selling solar roofs, which sounded like a great idea, but it just didn't work out.
And yet, Tesla pretty much created the electric vehicle (EV) market that exists today. So sometimes Musk's vision creates hugely profitable businesses. This dichotomy is why investors need to pay close attention to the spending going into Tesla's Optimus humanoid robots.
Image source: Getty Images.
How much money is Tesla spending? When Tesla reported second-quarter 2026 earnings, Musk noted that 2026 would be a "massive" year for capital expenditures. The current expectation is that the company will spend at least $25 billion. That seems to worry investors since the stock dropped sharply after its earnings release highlighted the company's spending had turned the business's cash flow negative. Optimus isn't the only thing the company is working on, but it could be one of the most impactful cash drains.
This is because Tesla has closed down some of its electric vehicle production lines and switched them to producing Optimus robots. That's a massive undertaking that's not only expensive but also leaves the company with no easy way to backtrack. It is going all in on Musk's vision around autonomous robotics. That's the same vision driving the company's robotaxi push, but at least the robotaxi effort builds on its existing car platform.
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The real problem here, however, isn't 2026. Elon Musk has telegraphed a multi-year period of elevated capital expenditures as it builds out its Optimus manufacturing capabilities, among other things. But Optimus robots stand out because they are a unique product and vastly different than anything else the company currently produces. If this product doesn't catch on, Tesla could have a very big headache on its hands. At the very least, there could be massive one-time charges for investors to contend with.
Par for the course with Elon Musk Bold bets are nothing new with Elon Musk, so the massive spending going toward the Optimus robot isn't exactly a shocking development. But investors shouldn't just glance over this product and move on. It represents a very important business shift that will have material near-term ramifications given the capital spending going toward the project, and could have even larger long-term implications for Tesla as a company. If you own Tesla, you need to pay close attention to this car company's shift toward robotics over the next couple of years.
Even after a harsh and sudden correction, Space Exploration Technologies (SPCX +0.45%) stock remains above its IPO price of $135. Cathie Wood, the CEO of Ark Invest, has used recent weakness in shares to add to her firm's position in SpaceX.
According to reports, Ark Invest bought 200,000 shares of the popular space stock across multiple ETFs. The combined purchases totaled around $27 million.
SpaceX is now the firm's second-largest holding, with a position value of roughly $680 million. Ark Invest's largest holding is another Musk-led business, Tesla (TSLA -1.71%). That holding is worth nearly $1 billion.
Why is Wood so bullish on Elon Musk's businesses? What prompted her to increase her position in SpaceX? The answer is simpler than you might think.
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Here's why Cathie Wood loves Elon Musk and SpaceX Fortunately, Wood often goes public with her investment theses. Therefore, understanding what she sees in a particular investment isn't difficult. Her comments make it clear that there is a direct connection between her Tesla stake and her growing bet on SpaceX.
In 2024, Ark Invest published a detailed report outlining the key drivers of its Tesla investment. The firm predicted a 2029 share price of $2,600. The reasons for Ark Invest's optimism were clear: According to the report, the firm expects that "nearly 90% of Tesla's enterprise value and earnings will be attributed to the robotaxi business in 2029." In short, it thinks autonomous technology will unlock a new era for Tesla.
Autonomous vehicles have long been "just around the corner." Musk himself is famous for his inaccurate predictions on the matter. "I am confident that in less than a year you will be able to go from highway on-ramp to highway exits without touching any controls," he declared in 2014.
It's taken much longer to achieve, but artificial intelligence (AI) can now handle extremely large and complex data sets in real time to make prompt and informed driving decisions. Experts recently polled by McKinsey & Co. believe robotaxis will be a reality "at a large scale" by 2030.
Image source: Getty Images.
Wood believes the robotaxi market could eventually be worth $10 trillion globally. It is that belief that underpins much of her investment in Tesla. The advent of robotaxis, however, will largely depend on rapid advances in AI. This reality is exactly what has fueled Wood's investment in SpaceX. Ark Invest believes SpaceX will scale profitable ventures like Starlink and reinvest the funds in more speculative AI initiatives.
"Once it completes Starlink's constellation -- in ~2035, according to our base case -- ARK's research suggests that SpaceX could generate ~$300 billion in annual revenue, accounting for ~15% of total spending on global communications," a report from the firm concludes. SpaceX can use those mounting cash flows to pursue orbital data centers, a speculative but high-upside opportunity.
Musk has previously stated his goal of launching 100 gigawatts of AI computing capacity per year. He eventually wants a network of 1 million orbital data centers. Ark Invest is very bullish on the plan. "ARK's research suggests that at sub-$100 per kilogram launch costs, orbital data centers could deliver compute at a cost ~25% lower than terrestrial alternatives without grid interconnection delays, permitting friction, or power scarcity," the firm concludes.
SpaceX's own IPO prospectus agrees that its future hinges not on Starlink development, but on its long-term AI ambitions. The company believes more than 90% of its total $28.5 trillion addressable market deals exclusively with AI opportunities.
At their core, Wood's investment theses for both Tesla and SpaceX hinge on AI growth and execution. Investors, therefore, must be all-in on this vision. Tesla's manufacturing capabilities and SpaceX's launch capabilities should be viewed more as enablers of this opportunity than as opportunities themselves. Without high confidence in AI's potential, an investment in either company likely doesn't make sense.
Space Exploration Technologies Corp. (NASDAQ:SPCX) and Tesla Inc. (NASDAQ:TSLA) CEO Elon Musk thinks that the U.S.’s advances in artificial intelligence and robotics would help the country widen the wealth gap with Europe.
AI, Robots Will Be the Key FactorsIn a post on X on Sunday, TV Presenter John Stossel posted a video asking why the U.S. was “50% richer” than Europe despite the latter having 100 million more citizens than the U.S. “This difference will get much bigger due to AI and robots in America,” Musk said in his response on Monday.
According to a report by the Financial Times last week, since 2021, the U.S.’s investments in AI technology rose three times faster than those of Europe, but the report also cited experts, who warned of an investment “bust” should the adoption of the technology fail to match expectations.
Starbase in Louisiana, TerafabMassive investments in AI and robotics were further illustrated by Musk’s Starbase in Louisiana, which could result in the Optimus becoming the first-ever "Von Neumann" machine. He also said that the company was targeting 1 Gigawatt of solar power deployments.
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The Terafab facility, which Tesla and SpaceX are breaking ground on in Grimes County, Texas, will become the world’s largest building. The facility is touted to be able to produce more than 1 terawatt of AI compute hardware annually.
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It will also be capable of churning out custom chips for Tesla’s Cybercab fleet, as well as Optimus and space infrastructure. However, Musk said the facility will cater more towards SpaceX than Tesla.
SpaceX Revenue To $3.5 Trillion?The comments come as the CEO earlier predicted that SpaceX would reach a revenue of $3.5 trillion by 2033, which was seven years earlier than investment bank Morgan Stanley‘s (NYSE:MS) prediction about the company. He had also predicted that SpaceX would reach $1 trillion in revenue by 2030.
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Check out more of Benzinga’s Future Of Mobility coverage by following this link.
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Tesla stock NASDAQ:TSLA is in focus after the electric-vehicle maker stopped selling its Solar Roof, reviving questions over execution at a company whose valuation still depends heavily on future businesses.
Tesla closed Wednesday at $345.82, down 1.3%, after rebounding from below $300 in late July to $366.50 last week.
The Solar Roof exit is unlikely to change Tesla’s earnings materially.
The bigger issue is whether abandoning a product Elon Musk once promoted signals another execution miss or more disciplined capital allocation.
Musk unveiled Solar Roof in 2016 as an alternative to conventional solar panels, with tiles designed to generate electricity while blending into a home’s roof.
Tesla later targeted 1,000 installations per week, but industry estimates suggested deployments never approached that ambition.
The company has now removed the product from its website, with the page redirecting customers towards conventional panels.
That does not mean Tesla is leaving solar, as the company continues selling panels and this month filed plans for a $10.1 billion solar-cell factory near Houston.
The stock-market concern is subtler. Solar Roof joins ambitious Tesla projects where execution has taken longer than initially promised.
Capital.com analyst Kris Allen wrote for Investing.com that Tesla’s share-price rebound faces resistance, warning: “Recovering towards the origin of a breakdown is not the same as reversing it.”
Tesla Energy is growing, but margins remain the real testTesla’s energy-storage business gives investors a reason to care about how the company allocates capital.
The company deployed 13.5 GWh of energy-storage products in the second quarter, up 53% sequentially and its second-highest quarterly total.
Yet profitability weakened sharply. Energy gross margin fell to 20.4% from 39.5% in the previous quarter, partly because of a $240 million warranty adjustment, the absence of earlier tariff benefits and lower industrial-storage prices amid growing competition.
Tesla expects longer-term energy gross margins to settle in the low-to-mid 20% range.
William Blair analyst Jed Dorsheimer sees scope for improvement. MarketWatch reported that he expects Tesla Energy growth to accelerate in the second half of 2026, with Megapack benefiting from AI data-centre and infrastructure demand.
That makes the Solar Roof decision easier to defend strategically.
Tesla may be cutting a difficult consumer product while concentrating resources on storage businesses that already operate at far greater scale.
Wall Street remains sharply divided over what investors should pay for Tesla’s future businesses.
GLJ Research reiterated a Sell rating and $24.86 target this month. According to Investing.com, the firm highlighted Tesla’s 1.4% second-quarter operating margin, negative $1.1 billion free cash flow and the decline in energy gross margin to 20.4%.
Bank of America analyst Alexander Perry takes the opposite view. He maintained a Buy rating and $460 target after second-quarter results, while cutting his 2026 earnings estimate because of weaker automotive and energy margins and higher research-and-development spending.
TipRanks reported that Perry sees Tesla at the “early stages of monetization of its autonomy capabilities,” reinforcing why bulls remain willing to look beyond current profitability.
The contrast captures the real issue for the stock.
Bears focus on margins, cash generation and Tesla’s history of ambitious timelines.
Bulls increasingly value the company around scalable businesses such as autonomy, robotaxis, Optimus and energy storage.
Tesla (TSLA -1.71%) is undergoing one of the biggest evolutions in automotive industry history, and you could almost consider it outside of the auto industry looking in at this point. Its vehicles are still selling well, but they're aging and requiring more margin-eroding incentives, while its capital expenditures are set to explode as it transitions its business to include humanoid robots, artificial intelligence (AI), and its eventual robotaxi business. That said, Tesla still has a massive advantage with technology, AI, and software, highlighted in Gartner's Digital Automaker Index 2026. Here's what investors should know.
Top ranks remain There are certainly noticeable trends within the index ranking, and Tesla's dominance still shines. The top six in the rankings remain unchanged from the prior year, and Tesla again took the No. 1 spot, improving its score from 79.3% last year to 82.7%. The next two competitors, Nio (NIO +0.23%) and Xiaomi, checked in with strong scores of 73.1% and 69.2%, respectively. Then scores drop significantly to round out the top six, represented by XPeng, Li Auto, and Rivian landing in a range of 55.5% to 57.7%.
Image source: Tesla.
The trend here is that U.S. young electric vehicle (EV) makers and Chinese automakers are dominating, improving nearly across the board, and legacy automakers such as General Motors (GM +0.10%), Ford Motor Company (F -0.50%), Stellantis (STLA +2.65%), and Volkswagen all fell further behind in the rankings despite large investments in software and AI. "It shows how many automakers aren't yet prepared enough to deal with AI," Gartner Vice President of Research Pedro Pacheco told Automotive News Europe.
It isn't just a Detroit auto problem, with European and Japanese automakers also struggling to close the gap with the top-ranking EV makers that have clearly been more prepared to adopt and innovate in software-defined vehicles and AI. Mercedes-Benz was the highest-scoring European automaker, ranking 11th, while Nissan and Mazda checked in at the lowest two ranks.
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What does this mean? Gartner suggests that much of the issue is the pace of internal transformation that isn't prepared to adapt to rapid tech adoption, which puts them further behind in the race to also attract talent to improve or innovate their vehicle architecture, connected vehicles, driverless technology, and AI (four of the 10 categories producing automaker scores).
For Tesla investors, this does lend some credibility to its transition into more technology-based businesses. According to Automotive News Europe, Gartner Vice President of Research Pedro Pacheco said:
When you buy technology from a vendor then any of your competitors can do the same. But if you develop the technology in-house, you have a chance to be better than the competition and differentiate yourself.
Whether or not Tesla is a stock to consider starting a position in really comes down to what you're investing for. Tesla helped change the game with EVs, but some analysts estimate that its future robotaxi business already accounts for almost half of the company's valuation. Tesla won't be the same car company investors bought into a decade ago, and its new business plans carry greater uncertainty and risk than its legacy automotive business. Tesla has problems to solve and challenging, expensive operational transformations to work through, but despite its flaws, this index suggests the company has the capability as the lines between software and traditional vehicles blur.
Daniel Miller has positions in Ford Motor Company and General Motors. The Motley Fool has positions in and recommends Tesla and Xiaomi. The Motley Fool recommends Gartner, General Motors, and Stellantis. The Motley Fool has a disclosure policy.
Avidian Wealth Enterprises LLC boosted its holdings in shares of Tesla, Inc. (NASDAQ:TSLA – Free Report) by 11.5% in the second quarter, according to its most recent filing with the SEC. The firm owned 20,038 shares of the electric vehicle producer’s stock after acquiring an additional 2,067 shares during the period. Avidian Wealth Enterprises LLC’s holdings in Tesla were worth $8,428,000 as of its most recent filing with the SEC.
Several other institutional investors and hedge funds also recently made changes to their positions in the business. State Street Corp boosted its position in shares of Tesla by 0.9% during the fourth quarter. State Street Corp now owns 114,842,934 shares of the electric vehicle producer’s stock worth $51,647,164,000 after purchasing an additional 1,080,085 shares in the last quarter. Geode Capital Management LLC increased its position in shares of Tesla by 0.6% in the 4th quarter. Geode Capital Management LLC now owns 65,700,975 shares of the electric vehicle producer’s stock valued at $29,426,070,000 after buying an additional 375,946 shares in the last quarter. Norges Bank bought a new stake in shares of Tesla in the 4th quarter valued at $17,128,100,000. Amundi raised its stake in Tesla by 14.0% during the 1st quarter. Amundi now owns 22,174,884 shares of the electric vehicle producer’s stock worth $8,243,513,000 after buying an additional 2,727,141 shares during the period. Finally, Corient Private Wealth LLC lifted its holdings in Tesla by 3,205.5% during the fourth quarter. Corient Private Wealth LLC now owns 21,459,599 shares of the electric vehicle producer’s stock worth $9,650,811,000 after acquiring an additional 20,810,386 shares in the last quarter. Institutional investors own 66.20% of the company’s stock.
Tesla Stock Down 1.3% Shares of Tesla stock opened at $345.82 on Thursday. The business’s 50 day simple moving average is $362.28 and its 200 day simple moving average is $385.80. Tesla, Inc. has a 52-week low of $297.38 and a 52-week high of $498.83. The firm has a market cap of $1.37 trillion, a PE ratio of 320.21, a P/E/G ratio of 17.68 and a beta of 1.83. The company has a debt-to-equity ratio of 0.09, a quick ratio of 1.55 and a current ratio of 1.94.
Tesla (NASDAQ:TSLA – Get Free Report) last released its earnings results on Wednesday, July 22nd. The electric vehicle producer reported $0.33 EPS for the quarter, missing the consensus estimate of $0.50 by ($0.17). Tesla had a net margin of 3.67% and a return on equity of 3.82%. The firm had revenue of $28.24 billion during the quarter, compared to the consensus estimate of $26.42 billion. During the same quarter in the previous year, the firm posted $0.33 EPS. The company’s revenue was up 25.5% on a year-over-year basis. On average, analysts predict that Tesla, Inc. will post 0.88 earnings per share for the current fiscal year. More Tesla News Here are the key news stories impacting Tesla this week:
Positive Sentiment: Nevada increased Tesla’s permitted Las Vegas robotaxi fleet from 10 vehicles to 5,000, providing regulatory support for the company’s autonomous-driving strategy. However, Tesla still must deploy and operate the expanded fleet successfully. Nevada robotaxi approval Positive Sentiment: Elon Musk teased a larger Tesla vehicle, potentially an SUV or Robovan, addressing a product gap in family-oriented vehicles and potentially expanding the company’s addressable market. Tesla Robovan teaser Wall Street Analysts Forecast Growth Several equities research analysts have issued reports on TSLA shares. William Blair restated a “market perform” rating on shares of Tesla in a report on Thursday, July 2nd. Citizens Jmp began coverage on Tesla in a research report on Thursday, July 9th. They issued a “market perform” rating for the company. Jefferies Financial Group set a $400.00 target price on Tesla and gave the stock a “hold” rating in a research note on Monday, July 13th. Citigroup restated a “market perform” rating on shares of Tesla in a report on Monday. Finally, Truist Financial set a $370.00 price target on shares of Tesla and gave the company a “hold” rating in a research note on Thursday, July 23rd. One research analyst has rated the stock with a Strong Buy rating, twenty-two have given a Buy rating, nineteen have assigned a Hold rating and four have issued a Sell rating to the company’s stock. Based on data from MarketBeat, the company has a consensus rating of “Hold” and a consensus price target of $401.74.
View Our Latest Research Report on Tesla
Insider Transactions at Tesla In other Tesla news, CFO Vaibhav Taneja sold 2,606 shares of Tesla stock in a transaction on Monday, June 8th. The shares were sold at an average price of $402.20, for a total value of $1,048,133.20. Following the sale, the chief financial officer directly owned 22,039 shares in the company, valued at approximately $8,864,085.80. The trade was a 10.57% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders own 19.90% of the company’s stock.
Tesla Profile (Free Report)
Tesla, Inc (NASDAQ: TSLA) is an American company that designs, manufactures and sells electric vehicles, energy generation and energy storage products. Founded in 2003 by Martin Eberhard and Marc Tarpenning, Tesla grew into a vertically integrated mobility and clean‑energy company with Elon Musk serving as its chief executive officer. The company’s stated mission is to accelerate the world’s transition to sustainable energy, reflected in its combined focus on electric drivetrains, battery technology, renewable energy products and software.
Tesla’s automotive business includes a lineup of battery‑electric vehicles and related services.
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Elon Musk, Sam Altman and Jensen Huang will share billing at a technology-focused Group of 20 ministerial meeting in North Carolina next week, according to Reuters.
SPCX stock is moving. See the real-time price action here. The gathering marks one of the few times that Tesla Inc. (NASDAQ:TSLA) and SpaceX (NASDAQ:SPCX) chief Musk, OpenAI’s Altman and Nvidia Corp. (NASDAQ:NVDA) leader Huang will appear on the same agenda.
Musk will join former White House AI czar David Sacks and Meta Platforms Inc. (NASDAQ:META) President Dina Powell McCormick in virtual remarks on Sept. 1. Huang and Altman are scheduled to speak in person the following day.
The event fits into the Trump administration’s broader push to keep Silicon Valley leaders close while it courts investment pledges and shapes AI policy ahead of December’s G20 leaders’ summit.
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Sacks and White House technology adviser Michael Kratsios already co-chair the President’s Council of Advisors on Science and Technology. Huang and Meta’s Mark Zuckerberg sit on that panel too, Reuters reported in March.
A joint stage for Musk, Altman and Huang has been unusual lately. Both Musk and Huang skipped a high-profile White House dinner last September that drew more than 30 tech executives. Musk said on social media he had been invited but “could not attend.”
Huang, meanwhile, has developed a pattern of favoring smaller, one-on-one sessions with the administration over large group settings, according to Fortune.
Still, the three men have crossed paths before. Musk, Altman and Huang all attended a Saudi Arabia investment forum alongside Trump in May 2025. Huang detailed plans there to supply the kingdom with Blackwell chips, and Trump announced a Saudi investment pledge tied partly to AI infrastructure.
Next week’s North Carolina meeting adds another data point for traders tracking how closely AI’s biggest names are aligning with the White House on policy.
Nvidia and Tesla shares have each moved on headlines tied to Musk’s and Huang’s political proximity this year. Commentary from the event could ripple through chip and AI infrastructure names.
Federal contracts, export rules for advanced chips and Musk’s Starlink and SpaceX ambitions all sit close to the administration’s tech agenda, giving the meeting more market relevance than a typical policy roundtable.
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This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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Tesla (TSLA -1.71%) is not valued as a traditional automotive stock. Much of the company's $1.1 trillion valuation is tied to future growth opportunities such as robotics and artificial intelligence. Robotaxis might be the company's largest long-term opportunity, with some experts predicting this industry will one day be worth $10 trillion worldwide.
Initially, Tesla CEO Elon Musk was very bullish about the pace and scale of Tesla's robotaxi rollout.
"I think we'll probably have autonomous ride hailing in probably half the population of the U.S. by the end of the year," Musk predicted in mid-2025. That never happened. Later that year, Musk told investors to expect "no safety driver by end of year" for the company's robotaxis. That, too, never came to pass.
At the start of 2026, Musk once again laid down the gauntlet, predicting:
We expect to have fully autonomous vehicles in probably somewhere between a quarter and half of the United States by the end of the year, pending regulatory approval. [W]e expect to be in dozens of major cities by the end of the year.
That prediction will likely not come true this late in the year. But Tesla did reveal some exciting news on Aug. 24 that will help the company move closer to Musk's ambitions.
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How valuable is Tesla's robotaxi launch in Nevada? Tesla's slower-than-expected robotaxi rollout isn't completely the company's fault. Slow regulatory approvals have also stymied growth. That's what makes the latest announcement so exciting.
On Aug 24, the Nevada Transportation Authority approved Tesla's application to operate a robotaxi service, clearing the way for it to launch 5,000 autonomous taxis in the state. Two competing robotaxi services, Alphabet's Waymo and Aviari, were approved to operate only 1,000 vehicles.
Image source: Tesla.
The expansion into Nevada is encouraging. Robotaxis are critical to Tesla's long-term valuation. But the slow rollout thus far should cause investors to be more conservative in their growth estimates.
I still see Tesla as the most powerful robotaxi operator in the U.S., especially given how vertically integrated its business is. But the path toward realizing Musk's robotaxi vision will be much longer than most analysts expect.
Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet and Tesla. The Motley Fool has a disclosure policy.
When Tesla (TSLA -1.71%) unveiled its all-electric Semi truck in 2017, analysts were largely bullish on potential demand.
"We believe this could set off competition for intelligent trucks in the industry," an analyst for Morgan Stanley predicted in 2017. "If the order books fill up quickly, any carrier that holds back placing its order could potentially have to wait several years to get its hands on a Tesla truck -- years during which its competitors could be running with up to a ~70% cost advantage."
Morgan Stanley stressed to investors that the Semi could be "the biggest catalyst in trucking in decades."
Other analysts were similarly optimistic. Analysts at Bernstein, for example, predicted Tesla would capture 3% of the semi market within five years. Piper Jaffray's research team believed that the Tesla Semi could revolutionize the company's revenue base. At the time, Tesla was generating just $11 billion in annual revenue. For comparison, Piper Jaffray estimated the market opportunity for Tesla's Semi truck to be more than $100 billion per year.
It has been nearly a decade since these predictions were made, and the results are clear: the Tesla Semi has been a major disappointment.
This time last year, only a few hundred Semis had been sold cumulatively. But things are starting to heat up. Einride AB just put in an order for 500 Semis, effectively tripling Tesla's lifetime sales for the truck.
Now, Tesla is planning a major Semi event on Sept. 24. According to reports, "The invite-only event will celebrate the opening of the new Semi factory and give attendees access to factory tours and ride-alongs in the updated Tesla Semi. The event comes several months after Tesla began building Semis on its new high-volume production line."
With production ready to scale alongside rising demand, is Tesla's Semi truck finally ready to make a meaningful impact to the company's bottom line? The answer is clearly yes, but there's one catch that investors should be wary of.
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Tesla investors should understand this caveat to Semi sales growthWhen the Tesla Semi was launched, big assumptions were made regarding the vehicle's ability to generate fuel savings and minimize ongoing operating costs. But higher upfront costs put a damper on demand.
Right now, the Tesla Semi is expected to cost around $350,000 when including the charger. A new diesel truck, meanwhile, runs closer to $165,000. Operating cost savings can be hard to predict. Diesel prices fluctuate, repair costs and lead times for the Semi aren't as forecastable as a conventional diesel truck, and local electricity prices vary widely. Plus, drivers simply aren't adapted to running an electric fleet.
Image source: Tesla
Higher fuel prices may help spur demand, but many of those adoption barriers -- chief of which is operator inexperience driving and maintaining an electric vehicle -- remain. That's what makes the advent of autonomous trucking so attractive for the Semi's sales potential.
McKinsey & Co. sees autonomous trucking taking off in the U.S. by 2032 -- just five years away. Tesla has invested heavily in its self-driving technology. With an ability to mass produce Semis with long-term cost savings and minimal labor needs, I expect Tesla to benefit immensely long term. But the sales ramp won't just follow theoretical cost savings -- it will also hinge on how quickly autonomous driving technology is developed and approved by regulators.
So while Semi sales should ramp in the coming years, I'm not expecting a major inflection point until autonomous trucking becomes a reality.
Tesla (TSLA -1.71%) has stated that 80% of the company's value will come from its Optimus robot in the future. That's a pretty impressive claim when you consider the profit potential in recurring revenue from Tesla's robotaxis (something Musk undoubtedly believes in). It's also something investors should consider when assessing the importance of initial Optimus production to the stock's long-term case.
That Optimus is now in production at Fremont, California (using production space previously used for Model X and Model S electric vehicles), is a landmark development. Still, it's not a pivotal moment for the company. As Musk has made abundantly clear, initial production is only the start of a lengthy and challenging process of scaling production in preparation for commercialization.
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Speaking on the recent earnings call, Musk said Optimus "will be the biggest product ever" and that "the production scaling challenge is very substantial. This is going to be the hardest product to scale manufacturing that we've ever made at Tesla."
Why Optimus production is challenging It's not hard to see why that might be the case: As Musk notes, "Everything on the robot is new," and there isn't a supply chain in place to build Optimus or any other robots of its type. Therefore, Tesla has had to "build up a supply chain in its entirety" or take production in-house, according to Musk.
The challenges are many. For example, Tesla is ultimately aiming to use Fremont production to create a manufacturing template for scaling at its Giga Texas factory in Austin, Texas, which will be its mass production plant dedicated to Optimus. However, generating the production momentum needed to standardize processes and reduce unit production costs could be difficult if Tesla continues to face supply chain constraints.
Image source: Tesla.
Optics might remain challenging Difficulties seem likely, given that Musk expects the "initial portion" of the "S-curve" production ramp will be "flat and long." By "S-curve," Tesla simply means that slow initial production will be followed by an aggressive ramping up and then a tailing off of growth. Of course, the problem with the S-curve is that it starts out somewhat flat.
That scenario will undoubtedly raise concerns, not least because the Giga Texas factory is part of Tesla's aggressive capital spending of more than $25 billion in 2026, with that figure set to rise in 2027 and 2028.
Image source: The Motley Fool.
What changes for Tesla investors It's important to remember that the initial production ramp-up isn't just about perfecting the manufacturing process; it will also kick-start a closed-loop learning cycle in which Optimus robots produced at Fremont will be used in Tesla's "Optimus Academy" , performing routine tasks on Tesla's own factory floors. It's a process that will enable incremental improvements in Optimus, potentially leading to long-term margin benefits. But here's the thing: The improvements are unlikely to be evident from the shape of the S-curve.
So don't be surprised if Tesla starts reporting on other performance indicators related to Optimus's performance (e.g., length of function, capability, asset use) in its own factories.
Tesla (TSLA -1.71%) trades at about $355 as of this writing, about 29% below its 52-week high of $498.83. For most stocks, a decline that deep leaves the shares meaningfully cheaper.
In one narrow sense, it has here. But Tesla still costs about 330 times earnings.
Has the decline made the stock cheaper on any measure the business supports? I don't think so. Here's a closer look at why.
Image source: The Motley Fool.
The multiple was never ordinaryMeasured against the $1.08 per share Tesla went on to earn in 2025, the stock's December peak near $499 was priced above 460 times earnings. Today's 330 times earnings is lower. But cheaper than 460 times earnings is not the same thing as cheap.
The deeper problem is that earnings have fallen in each of the past two years. Tesla earned $4.30 per share in 2023, its most profitable year on record. That fell to $2.04 in 2024 and $1.08 in 2025. And the trailing-12-month figure still sits at $1.08 today.
Tesla's recent reports, the latest of which arrived on July 22, explain why. Tesla's operating margin has stepped down from 5.8% in the third quarter of 2025 to 5.7%, then 4.2%, then 1.4% in the second quarter of 2026 (down from 4.1% in the year-ago quarter). Driving the decline, operating expenses jumped 47% year over year, and gross margin slipped to 16.8% from 17.2%.
Notably, even the latest quarter's bottom line got help: net income included an unrealized pre-tax gain of about $1 billion on Tesla's investment in SpaceX, worth about $0.22 per share after tax.
In short, the price fell, but the earnings underneath it never grew. That's why a 29% decline still leaves the stock at a valuation multiple most large companies never touch.
What would make 330 times ordinary?For Tesla to trade at 30 times earnings at today's share price, it would need to earn about $11.80 per share annually. That's about 11 times its current trailing earnings -- and close to three times its best year ever.
Looking forward doesn't close the gap much. Based on consensus estimates, shares cost about 160 times next year's expected earnings.
However, the time element matters, too. Reaching $11.80 in earnings per share within a decade would require compounding profits at about 27% a year, every year, from a base that has shrunk in each of the past two years. It may happen. But that is the scale of what today's price assumes.
The business the price is betting onTo be fair, parts of the business are moving in the right direction. Second-quarter revenue rose 26% year over year to $28.2 billion, and vehicle deliveries grew 25%. Services and other revenue jumped 50% to $4.6 billion, and the energy storage business grew 13%.
The software side is growing quickly, too. Active subscriptions to the company's Full Self-Driving (Supervised) software reached 1.48 million, up 56% year over year. And the Robotaxi service has kept expanding, with the purpose-built Cybercab beginning production during the quarter.
The costs are arriving first, though. Capital expenditures reached $5.8 billion in the second quarter, up 142% year over year, and free cash flow swung to negative $1.1 billion. With more than $40 billion in cash and investments, Tesla can afford the push. But the spending hits free cash flow before any new profits do, and it likely will for a while.
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Tesla itself describes this as its "largest and most exciting period of investment," and management says it expects "an acceleration of AI, software and fleet-based profits" over time.
Maybe that acceleration comes. The delivery and software numbers show a business with plenty of demand, and CEO Elon Musk has typically spent ahead of the opportunity. But an 11-fold profit increase isn't something anyone can responsibly forecast from a 1.4% operating margin and negative free cash flow.
So, has the decline made the stock cheaper? Only against its own past price. On the earnings the company produces today (or has produced in any year of its history), Tesla remains arguably one of the most expensive large-cap stocks in the market. Yes, the business is making progress on cars, software, and robotaxis. But the profits that could support this valuation multiple haven't shown up yet.
Cathie Wood has made a name for herself by going all-in on tech, whether it was software stocks when they were novel, cryptocurrencies, or now artificial intelligence (AI) stocks. Her firm, Ark Invest, runs several exchange-traded funds (ETFs) that give investors access to baskets of tech and AI stocks managed by her and her team.
The largest Ark ETF is called the ARK Innovation ETF (ARKK -3.19%), which had roughly $6.42 billion in assets under management as of Aug. 25. Wood and her team invested roughly $1.4 billion of this capital in just three AI-related stocks. Let's find out a bit more about these three Wood-favored stocks.
Ark Investment Management CEO Cathie Wood. Image source: Getty Images.
1. Tesla: $594.8 million Wood and her team have long been bullish on Tesla (TSLA -1.71%), from its days operating primarily as an electric vehicle company to its current focus on its emerging robotaxi fleet and humanoid robots. ARK Innovation ETF's position in Tesla amounted to nearly $595 million as of this writing, or 9.26% of the fund.
While it's a bit stale at this point, Ark published a deep dive on Tesla in June 2024, assigning the stock a monster $2,600 price target in its base case for 2029, implying more than a sevenfold increase from current levels.
Much of the bullishness is based on robotaxis. By 2029, Wood and her team believe the robotaxi business will make up 63% of Ark Invest's projected $1.2 trillion of revenue for the company that year; 86% of the projected $440 billion earnings before interest, taxes, depreciation, and amortization (EBITDA); and 88% of the $8.2 trillion enterprise value. That also implies a 37% EBITDA margin.
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Tesla launched robotaxis in seven markets as of late July. Management also reported on the second-quarter earnings call that unsupervised robotaxis have now driven 380,000 miles.
Still, the fleet is scaling slowly and cautiously to focus on safety, and even Tesla CEO Elon Musk noted on the earnings call that robotaxis need cellular coverage everywhere. There is also plenty of competition in the space now.
While Tesla very well could succeed with robotaxis and humanoid robots down the line, I'm still cautious on the stock while it trades at close to 198 times forward earnings.
2. Tempus AI: $401.7 million ARK Innovation's second-largest position, accounting for 6.25% of the fund, is class A shares of Tempus AI (TEM -9.41%).
Tempus is leveraging AI to create more precise laboratory testing that can also be more personalized for the patient by integrating a patient's clinical data into the testing. The company has also built the Tempus platform, which it claims is one of the largest libraries of clinical and molecular oncology data in the world.
Tempus stock actually got a lift recently following the release of phase 3 trial results from a joint study conducted by Moderna and Merck, which showed that its personalized messenger ribonucleic acid (mRNA) vaccine, combined with Merck's immunotherapy Keytruda, produced better results than those who took Keytruda alone.
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Tempus recently acquired Personalis, which created the genomic tumor-profiling technology that played a significant role in the development of the Merck and Moderna treatment.
AI is likely to play a big role in improving healthcare, but Tempus is another AI stock that has benefited from a lofty valuation. The company now has a $12.4 billion market cap but is still losing money.
Companies like Tempus depend heavily on big breakthroughs, so it's not uncommon these days for investors to front-run the valuation if they think the potential is there.
3. SpaceX: $377.7 million Space Exploration Technologies (SPCX +0.45%) is the ETF's third-largest position, accounting for roughly 5.88% of the fund. Ark has been buying shares of SpaceX since the company's initial public offering, although it's unclear whether it participated in the IPO.
It makes complete sense that Wood bought SpaceX, given her belief in Tesla, because Musk runs both companies. SpaceX also has many businesses that Wood would be interested in from a technology standpoint, whether it's the launch business, Starlink, or the broader AI unit.
In July, Wood also told Fox Business that SpaceX "could become the most important company in history." There's also been talk that SpaceX and Tesla could eventually merge.
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SpaceX's $1.89 trillion valuation is largely built on the premise of great success in the AI unit, which SpaceX has said has a $26.5 trillion total addressable market (TAM). The unit includes the social platform X, Grok Intelligence, SpaceX's data centers, a future terafab facility, and the ability to create enterprise solutions that could potentially mimic human workflows.
The bull thesis really centers on SpaceX's super-heavy-lift, fully reusable rocket, Starship, which Musk wants to eventually use to make multiple missions to space per week. Starship could be the key to enabling orbital data centers, which could take a significant share of AI compute.
If it all works out, the stock is likely to soar and become another multibagger. But remember, Starship is still in testing, and developments on the space front are likely to move slowly, so it's far from a sure thing.
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Rivian's CFO is walking out the door just as the company's most important vehicle ramp gets underway, and shareholders are voting hard on what that timing means for the equity story.
The electric vehicle trade is coming under renewed pressure Friday morning after Rivian confirmed a top-level finance change, and the news is landing while the broad market grinds higher and a key EV peer fades an earlier rebound. The move is squarely single-catalyst, reshuffling how the market prices the biggest pure-play EV names into month-end.
Rivian Automotive (NASDAQ:RIVN | RIVN Price Prediction) stock is down 6% to $15.80 in late-morning trading, a sharp reversal after the company disclosed that Chief Financial Officer Claire McDonough is resigning at the end of October. Rivian stock was down 15% year to date (YTD) through Thursday’s close, so today’s slide extends what was already a difficult stretch for shareholders.
Meanwhile, Lucid Group (NASDAQ:LCID) stock is down 1% to $5.03, giving back part of a prior-session bounce, while Tesla (NASDAQ:TSLA) stock is down 0.2% to $354.13. The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is up 0.48% to $774.80, so today’s weakness is confined to the EV group while the broad tape advances.
CFO Departure Confirmed in Regulatory Filing Rivian stated in a filing Thursday that McDonough is stepping down to “pursue a new opportunity and relocate to the East Coast to be closer to her family,” and it stated the resignation is “not the result of any disagreement.” GE Vernova and McDonough’s own LinkedIn post confirm she has been hired as chief financial officer of GE Vernova (NYSE:GEV). Her departure is effective at the end of October, giving Rivian roughly two months to name a permanent replacement.
The company is actively searching for that permanent successor, and vice president of finance Derek Mulvey will serve as interim CFO once McDonough leaves. Notably, GE Vernova stock is down 3% to $929.58 in the same session, so the destination company isn’t receiving a warm reception on its incoming hire either.
Why the Exit Stings During the R2 Ramp McDonough was hired in January 2021 and became central to Rivian’s balance sheet and cost-of-revenue work through the company’s most difficult stretch. She played a key role in the technology joint venture with Volkswagen Group, under which Volkswagen agreed to invest up to $5.8 billion into Rivian by 2027 in exchange for access to Rivian’s electrical architecture and software, finalized in November 2024.
Her exit lands while Rivian scales production and sales of the R2 SUV, which began shipping to customers this summer. Rivian investors tend to punish finance-leadership turnover during capital-intensive product ramps, and today’s tape is reflecting that reflex in real time. The transition also removes a familiar voice from Rivian’s quarterly calls at a moment when guidance credibility matters most for the story.
Rivian’s finance team has spent the past several years defending its cash runway while funding the R2 platform, and continuity at the top of that team was a quiet source of confidence for the equity story. Losing that continuity is what Rivian shareholders are pricing in today, ahead of any additional commentary on how the CFO search will proceed.
EV Complex Fades Yesterday’s Bounce In the prior session, EV names staged a rally in which Lucid stock jumped 7% and Rivian stock edged higher, and it asked whether the EV selloff was finally exhausted. Today answers that question in the negative. Lucid stock has given back part of that gain and Rivian stock has reversed outright, so the pause has proven tactical for holders looking for a durable turn.
Lucid stock was down 52% YTD through Thursday’s close, and Tesla stock was down 21% YTD through the same session, so both names entered Friday with meaningful drawdowns already baked in. No company-specific catalyst has been confirmed at Lucid or Tesla today, and neither company is affected by Rivian’s CFO departure. The mechanism for the peer softness is continued weakness in the electric vehicle complex, and the SPY advance highlights that the pressure is name-and-sector specific.
What to Watch Next Traders can watch for further disclosures around Rivian’s CFO search timeline and any commentary tied to the R2 production ramp, both of which could reset sentiment ahead of the next quarterly update. GE Vernova shareholders may similarly want context on how the McDonough hire fits inside the company’s cash-generation trajectory over coming quarters.
For investors holding EV exposure, the day’s price action argues for keeping their positions sized modestly and adding only on confirmation that the group can absorb news like this without deepening the drawdown. In a tape where the broad market is higher and single-name EV stories keep breaking negative, discipline on their exposure should take precedence over chasing bounces.
Contact [email protected] for any questions or corrections.
Tesla is down 23% for the year yet Robotaxi is expanding, Cybercab production has started, and Optimus lines are being installed. Whether those catalysts can close the gap between today's compressed margins and tomorrow's potential defines exactly how far this…
Tesla is heading into a defining stretch. Robotaxi has scaled to seven US metros, Cybercab production has started, and Optimus manufacturing lines are being installed. That is the setup behind our updated 24/7 Wall St. price target on Tesla (NASDAQ:TSLA | TSLA Price Prediction), the highest-conviction electric vehicle and AI story in our coverage universe.
With shares at $352.94, our 24/7 Wall St. price target for Tesla is $376.30, pointing to 6.77% upside over the next 12 months. The recommendation is buy, with high model confidence of 90%.
24/7 Wall St. Price Target Summary Metric Value Current Price $352.94 24/7 Wall St. Price Target $376.30 Upside 6.77% Recommendation BUY Confidence Level 90% Robotaxi Is the Catalyst Rewriting the Story Tesla shares are down 23.1% year to date, yet bounced 11.84% in the past month as Robotaxi expansion accelerated. The 52-week range runs from $297.38 to $498.83.
Q2 2026 revenue hit $28.24 billion, up 25.5% and beating estimates by 7.1%, while non-GAAP EPS of $0.33 missed expectations by 38.51% as capex more than doubled to $5.79 billion. Deliveries reached a record 480,126 vehicles and FSD subscriptions crossed 1.48 million.
On the earnings call, Elon Musk described Robotaxi mileage growth as “exceeding 10% a week”, with Tesla logging more than 380,000 miles of unsupervised Robotaxi without a notable incident.
Bull Case for $460 and Beyond Our bull-case one-year target is $460.67, roughly 30.71% upside. Musk called Optimus “the biggest product ever”, with aspirational output of 10 million units a year for Optimus 4. Cybercab production has begun at Gigafactory Texas, Model YL launched in July, and FSD gained approval across five European countries.
Energy storage deployments hit 13.5 gigawatt hour, up 53% sequentially. If Robotaxi utilization compounds at double-digit weekly rates and Optimus ships in volume, the analyst high side and our five-year bull case of $674.52 become reasonable.
What Could Go Wrong Operating margin compressed to 1.4% in Q2 and free cash flow flipped to -$1.09 billion. Regulatory credit revenue is declining, and management flagged 2026 capex above $25 billion, funded partly by $30 billion in new debt capacity.
Bulls counter this is the classic investment cycle: fabs, Optimus lines, and AI compute build earnings power for the next decade. Our bear-case one-year target is $340.70, only modest downside from here.
How Tesla Compares to Alphabet and Rivian Alphabet (NASDAQ:GOOGL) is the essential autonomy comparison because Waymo is Robotaxi’s most credible competitor. Alphabet trades at a trailing P/E of just 15 with a 33% operating margin, versus Tesla’s 323 trailing multiple. That gap explains why our 24/7 Wall St. price target is restrained. Investors are already paying full price for Tesla’s optionality.
Rivian (NASDAQ:RIVN) is the EV pure-play counterpoint, with a $24 billion market cap and a Robotaxi deal with Uber for up to 50,000 R2 units. Rivian is still loss-making at the operating line, underscoring Tesla’s scale advantage. Against this peer set, our $376.30 target looks reasonable rather than aggressive.
Company Forward P/E Op Margin Tesla 185 1.4% Alphabet ~20 32% Rivian n/m -67% Tesla Price Prediction 2026-2030 The 24/7 Wall St. price target of $376.30 carries a buy signal with 90% confidence. The bullish thesis strengthens if Robotaxi weekly mileage keeps compounding and FSD take rates hold above 50%.
The thesis weakens if operating margin stays pinned near 1% into Q4 with no line-of-sight to Optimus revenue.
Year 24/7 Wall St. Price Target 2026 $376 2027 $383 2028 $391 2029 $407 2030 $460 These projections assume Tesla continues executing on Robotaxi scaling and Optimus production. Meaningful upside or downside would come from earlier-than-expected Optimus revenue or a regulatory setback in autonomous driving.
Contact [email protected] for any questions or corrections.
Tesla (TSLA -1.71%) is taking steps forward in operating a robotaxi fleet.
*Stock prices used were the afternoon prices of Aug. 24, 2026. The video was published on Aug.26, 2026.
Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
Tesla, Inc.'s price corrected drastically after Fiscal Q2 2026 earnings, reflecting the market's continued focus on its near-term margins. This focus misses the company's long-term platform value brought about by its autonomous technologies. FQ2 earnings updates show multiple signs of monetization for TSLA's autonomy capabilities, whose nonlinear growth potential is not fully priced in.
The hype around humanoid robots isn’t particularly new. Thank Tesla CEO Elon Musk and his Optimus robot, as well as the myriad videos of Boston Dynamics’ Atlas robot, for that.
Behind that hype, though, there is real progress. The physical capabilities of robots continue to improve, and researchers now believe that the AI techniques behind large language models can make complex robots capable of learning nearly any task.
Those tailwinds have encouraged a new batch of companies to jump in on the promise of profits from humanoid robots. And many of the latest entrants are Chinese automakers.
Earlier this week, Xpeng’s robotics unit raised more than $900 million at a post-money valuation of more than $6.3 billion. The round, led by IDG Capital with participation from Gaorong Ventures, Tencent, and Alibaba, was described by the company as the largest single-round private financing ever recorded in China’s “embodied AI” industry (AI systems built directly into physical machines).
This month, AiMOGA, the robotics unit of China’s Chery Automobile, reportedly began preparing for an IPO, while BYD unveiled a humanoid robot called Xiao Di. Other Chinese automakers, including Changan, GAC, Li Auto, SAIC, and Seres, are also developing humanoid robots.
Among all of them, Xpeng is the Chinese automaker that most closely watches and follows Tesla’s initiatives, according to Michael Dunne, CEO of San Diego- and Singapore-based advisory firm Dunne Insights.
“It’s the most focused on autonomy, it’s the first to commit in a big way to humanoid robots,” Dunne told TechCrunch, adding that Xpeng founder He Xiaopeng is a tech billionaire known for his agility and quick adjustments. “He sees razor-thin profit in cars on the near horizon. Robots look much more promising.”
Xiaopeng and Xpeng co-president Brian Gu are bullish enough that they’ve put their own funds behind the robotics unit. According to the Wall Street Journal, the pair invested about $100 million into the recent fundraising round.
Xpeng’s bet is on Iron, a humanoid robot with a realistic human shape that is built for commercial deployment.
Chinese automakers like Xpeng do bring a manufacturing edge.
“They have all the hardware to get the job done,” Dunne said. “Question is if they can catch Tesla on the AI side of the equation.”
There are, of course, many other companies developing humanoid robots, including Agility Robotics, Apptronik, and Figure, all chasing the same goal: commercial deployment at scale.
Hyundai-owned Boston Dynamics is getting closer to that goal. Hyundai plans to bring Boston Dynamics’ Atlas humanoid robot to its Georgia factory this year and eventually deploy the robots for tasks like parts sequencing by 2028. The Korean automaker, which partnered with Google’s AI research lab DeepMind to speed up the development of Atlas, is opening a U.S. facility this year called a Robot Metaplant Application Center, which will teach robots how to map movements like lifts and turns.
Other automotive companies are also jumping, including supplier Mobileye, which acquired humanoid robot startup Mentee Robotics earlier this year for $900 million. Even Rivian is dabbling in robots with its Mind Robotics spinout — although its robots are not expected to look quite like the humanoids in development elsewhere.
When you purchase through links in our articles, we may earn a small commission. This doesn’t affect our editorial independence.
Kirsten Korosec is a reporter and editor who has covered the future of transportation from EVs and autonomous vehicles to urban air mobility and in-car tech for more than a decade. She is currently the transportation editor at TechCrunch and co-host of TechCrunch’s Equity podcast. She is also co-founder and co-host of the podcast, “The Autonocast.” She previously wrote for Fortune, The Verge, Bloomberg, MIT Technology Review and CBS Interactive.
You can contact or verify outreach from Kirsten by emailing [email protected] or via encrypted message at kkorosec.07 on Signal.
Tesla (TSLA -3.83%) takes another step forward in its robotaxi ambitions.
*Stock prices used were the afternoon prices of Aug. 22, 2026. The video was published on Aug.24, 2026.
Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
Tesla's (TSLA) wheelless and pedal-less Cybercab vehicle now has a release date as Alibaba (BABA) and Softbank race to fund AI investments. Marley Kayden and Sam Vadas run through their top takeaways to close out the first trading session of the week.
Nine automakers, including Tesla (TSLA -3.83%), plan to recall a record 4 million-plus vehicles. Tesla by far has the most vehicles to recall, at nearly 3 million.
The stock fell nearly 4% on Aug. 24.
Chinese regulators are enforcing the recall due to door handles that potentially make it difficult for people to find and use them in an emergency.
On Tesla vehicles, exterior door handles are electric and draw power from the vehicle's operating system, rather than being mechanical and connected to a latch. Manual door releases do exist on the inside, but they can reportedly be difficult to find.
Tesla's door handles gave its electric vehicles a sleek, futuristic look, which other automakers have mimicked. Other automakers recalling vehicles in China include Xiaomi, Leapmotor, Xpeng, and Geely Holding.
In a statement on Aug. 21, Tesla said vehicles being recalled include its Model 3, Y, S, and X, citing door handles that blend into the interior.
"In extreme situations such as a severe collision causing the vehicle's low-voltage system to fail, this could hinder occupants from quickly opening the doors to escape and impede rescue efforts by those outside the vehicle, posing a safety hazard," Tesla said in a statement reported by various media outlets.
Here's what else investors need to know.
Image source: Tesla.
Regulators crack downAccording to Reuters, Chinese regulators are responding to several past incidents in which electric door-handle releases failed during emergencies.
Last October, Chinese state media reported that a driver in a Xiaomi vehicle died after an accident in which people nearby could not open the vehicle's door.
The recall is not a total surprise, as China announced a ban on concealed door handles in electric vehicles, starting in 2027, although existing vehicles that have already been approved have until 2029 to make the changes.
Under new rules, vehicles must have a manual release handle on both the inside and outside of the vehicle, according to the BBC.
In the near term, Tesla and the other automakers plan to add warning labels to their vehicles and make remote software updates. For instance, according to Reuters, Tesla's update will have windows open following a crash or accident.
Chinese regulators aren't the only ones looking at door handles.
In 2025, the National Highway Traffic Safety Administration (NHTSA) also investigated reported incidents in which vehicle operators could not get into their vehicles in certain situations due to malfunctioning door handles.
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The NHTSA's Office of Defects Investigation conducted a preliminary review that found the door handles may not work if they don't receive enough power from Tesla's battery system.
How big a deal is this for Tesla stock?While Tesla stock fell nearly 4% on Aug. 24, tech stocks also underperformed due to rising long-term bond yields that have been rattling investors lately.
Tesla's door handles have helped the company stand out, so perhaps this impacts the branding in some way.
But while it's not a good headline, I doubt it will be a long-term issue for the stock. Most Tesla investors have moved on from the core EV business, which has struggled for several years.
Many Chinese competitors were already developing cheaper models with performance similar to Tesla's.
Investors are now focused on Tesla's emerging robotaxi fleet and humanoid robots, so yes, existing models still need to be fixed, but there are bigger issues the market is focused on.
Regardless, I still believe Tesla's valuation is far too stretched to make it an appealing investment right now.
The record safety campaign targets nearly six times Tesla's latest quarterly deliveries. Summary
Tesla accounts for approximately 69% of all vehicles included in China’s recall.
Tesla (TSLA), the electric-vehicle, energy-storage and robotics giant, fell approximately 1.7% to $356.70 Monday morning as China's sweeping automotive recall rattled investors. Tesla must fix emergency door-release problems across roughly 2.98 million vehicles—more than any other automaker caught in the regulatory crackdown.
The full recall reaches approximately 4.3 million vehicles from nine manufacturers. The concern is simple but serious: electronic doors may become difficult to open after a crash or power failure. Tesla can tackle most of the problem through remote software updates and clearer emergency-release labels, keeping the immediate repair bill contained. The next hurdle is harder. China will ban fully concealed exterior door handles beginning in 2027, raising the prospect of physical redesigns across future models.
Tesla delivered more than 480,000 vehicles during the second quarter, meaning the recall covers more than six quarters of current global deliveries. The shares also sit 7.01% above their $333.34 GF Value™, leaving little room for another regulatory surprise. A software patch may solve today's problem, but at more than 300 times earnings, Tesla's premium valuation makes even a fixable safety issue hit harder.
Disclosures I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.
Prediction markets give Tesla Inc (NASDAQ:TSLA), the electric carmaker, just a 17% chance of completing a genuine retail sale of its Cybercab this year.
Market confidence has fallen from 33% in late April despite an upcoming exclusive launch event in Austin, Texas, on September 3.
The Polymarket prediction contract dictates that fleet deployments, employee sales, and prototypes do not qualify as completed retail sales.
Tesla must complete a direct sale to a member of the public under publicly available terms for $30,000 or less by December 31.
The prediction market contract on the retail deadline has attracted approximately $48,500 in total trading volume.
Tesla builds the two-seat robotaxi without a steering wheel or pedals at its Giga Texas manufacturing facility.
The rollout is expected to begin with employee rides before the Cybercab joins the localized Austin Robotaxi service days later.
This initial deployment puts the autonomous vehicle into commercial service without placing it into the hands of ordinary buyers.
Elon Musk, the chief executive, originally promised retail customers that they could buy the vehicle for $30,000 or less.
Musk told investors during an earnings call that building a regular entry-level vehicle was pointless when the Cybercab could serve that market.
He later confirmed on social media that a retail customer would be able to buy the vehicle at that price point before 2027.
The company subsequently omitted its previous target for volume production in 2026 from its second-quarter financial update.
Musk warned investors that the initial production ramp for the new vehicle would be agonizingly slow.
The September launch remains crucial for the automaker as it attempts to reinvent itself as an autonomy and robotics business.
This strategic pivot underpins much of the corporate valuation even though standard electric vehicles generate the bulk of current revenue and profit.
Longtime investors have questioned whether the chief executive maintains sufficient focus on the carmaker amid his growing attention to SpaceX, the aerospace manufacturer.
A successful launch event next month will advance the commercial robotaxi network beyond Model Y vehicles.
The event will not fulfill the retail ownership promise made to ordinary buyers.
Musk will still have four months following the September launch to put a $30,000 Cybercab into a customer's hands.
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Ahara Advisors LLC raised its position in shares of Tesla, Inc. (NASDAQ:TSLA – Free Report) by 209.9% during the 2nd quarter, according to the company in its most recent 13F filing with the SEC. The fund owned 11,436 shares of the electric vehicle producer’s stock after purchasing an additional 7,746 shares during the quarter. Tesla accounts for 3.3% of Ahara Advisors LLC’s portfolio, making the stock its 10th largest position. Ahara Advisors LLC’s holdings in Tesla were worth $4,810,000 at the end of the most recent reporting period.
A number of other hedge funds have also modified their holdings of the company. Marks Group Wealth Management Inc grew its position in Tesla by 1.7% during the 4th quarter. Marks Group Wealth Management Inc now owns 1,512 shares of the electric vehicle producer’s stock worth $680,000 after purchasing an additional 25 shares during the period. Clear Trail Advisors LLC lifted its holdings in shares of Tesla by 1.6% in the 1st quarter. Clear Trail Advisors LLC now owns 1,628 shares of the electric vehicle producer’s stock valued at $605,000 after buying an additional 25 shares during the period. Peirce Capital Management LLC boosted its stake in shares of Tesla by 1.5% in the second quarter. Peirce Capital Management LLC now owns 1,657 shares of the electric vehicle producer’s stock worth $697,000 after buying an additional 25 shares during the last quarter. Brio Consultants LLC grew its holdings in Tesla by 4.7% during the fourth quarter. Brio Consultants LLC now owns 575 shares of the electric vehicle producer’s stock worth $259,000 after acquiring an additional 26 shares during the period. Finally, Community Bank & Trust Waco Texas raised its position in Tesla by 1.7% during the fourth quarter. Community Bank & Trust Waco Texas now owns 1,581 shares of the electric vehicle producer’s stock valued at $711,000 after acquiring an additional 26 shares in the last quarter. 66.20% of the stock is owned by institutional investors and hedge funds.
Tesla Price Performance Shares of TSLA opened at $362.86 on Monday. The stock has a 50 day moving average price of $365.62 and a 200 day moving average price of $387.07. Tesla, Inc. has a one year low of $297.38 and a one year high of $498.83. The company has a debt-to-equity ratio of 0.09, a quick ratio of 1.55 and a current ratio of 1.94. The stock has a market capitalization of $1.43 trillion, a price-to-earnings ratio of 335.98, a PEG ratio of 18.32 and a beta of 1.83.
Tesla (NASDAQ:TSLA – Get Free Report) last announced its earnings results on Wednesday, July 22nd. The electric vehicle producer reported $0.33 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.50 by ($0.17). Tesla had a return on equity of 3.82% and a net margin of 3.67%.The business had revenue of $28.24 billion for the quarter, compared to analyst estimates of $26.42 billion. During the same period last year, the firm earned $0.33 EPS. The company’s revenue for the quarter was up 25.5% compared to the same quarter last year. Equities research analysts forecast that Tesla, Inc. will post 0.88 earnings per share for the current fiscal year. Tesla News Summary Here are the key news stories impacting Tesla this week:
Positive Sentiment: Nevada regulators approved Tesla’s application to operate up to 5,000 fully autonomous vehicles during the first year, clearing a path for a Las Vegas robotaxi launch. The approval strengthens the investment case for Tesla’s autonomy strategy and could provide an important commercial test for its Cybercab platform. Nevada approves Tesla fleet of 5,000 fully autonomous vehicles Positive Sentiment: Tesla is preparing to showcase and expand its Semi truck in Europe, including at September’s IAA Transportation event. A reported order for 500 Semis from Einride and plans to scale Nevada production support expectations that commercial vehicles could become a meaningful new growth engine. Tesla Semi truck expansion into Europe Positive Sentiment: Recent Tesla commentary has emphasized confidence in scaling Cybercab operations and a potential step-change from its FSD V15 software. Investors view robotaxis, autonomy and the Semi as necessary growth businesses to support Tesla’s premium valuation as automotive growth matures. JPMorgan on Tesla Cybercab and FSD V15 Neutral Sentiment: Analysts and investors continue debating whether Tesla’s roughly 292-times earnings valuation adequately reflects future robotaxi, Semi and artificial-intelligence growth. Supporters see substantial long-term upside, while skeptics argue the valuation leaves little room for execution delays or disappointing adoption. Tesla Robotaxi and Semi valuation analysis Negative Sentiment: Tesla will voluntarily recall nearly 3 million vehicles in China to address emergency door-release and driver-monitoring concerns. Although the fix is expected to be software-based and other automakers are involved, the recall adds regulatory, safety and reputational risk in a key market. Tesla China recall Negative Sentiment: Reports that Tesla has ended Solar Roof tile operations highlight the company’s retreat from a business that failed to achieve expected scale. Separately, questions about Autopilot crash-data disclosures and a robotaxi incident in Austin could make investors more cautious about Tesla’s readiness for unsupervised autonomy. Tesla Solar Roof shutdown Insider Activity In other news, CFO Vaibhav Taneja sold 2,606 shares of Tesla stock in a transaction on Monday, June 8th. The stock was sold at an average price of $402.20, for a total transaction of $1,048,133.20. Following the transaction, the chief financial officer owned 22,039 shares in the company, valued at $8,864,085.80. The trade was a 10.57% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. 19.90% of the stock is owned by company insiders.
Analyst Upgrades and Downgrades TSLA has been the subject of a number of analyst reports. BTIG Research downgraded Tesla to a “neutral” rating in a report on Friday, June 5th. William Blair reaffirmed a “market perform” rating on shares of Tesla in a report on Thursday, July 2nd. Citigroup started coverage on shares of Tesla in a report on Thursday, July 9th. They set a “market perform” rating on the stock. Wells Fargo & Company restated an “underweight” rating and set a $130.00 price target (up from $125.00) on shares of Tesla in a research report on Tuesday, July 14th. Finally, Erste Group Bank raised shares of Tesla from a “sell” rating to a “hold” rating in a report on Friday, June 5th. One investment analyst has rated the stock with a Strong Buy rating, twenty-two have issued a Buy rating, nineteen have issued a Hold rating and four have given a Sell rating to the company’s stock. According to MarketBeat, the stock has a consensus rating of “Hold” and an average target price of $401.74.
Read Our Latest Analysis on TSLA
Tesla Profile (Free Report)
Tesla, Inc (NASDAQ: TSLA) is an American company that designs, manufactures and sells electric vehicles, energy generation and energy storage products. Founded in 2003 by Martin Eberhard and Marc Tarpenning, Tesla grew into a vertically integrated mobility and clean‑energy company with Elon Musk serving as its chief executive officer. The company’s stated mission is to accelerate the world’s transition to sustainable energy, reflected in its combined focus on electric drivetrains, battery technology, renewable energy products and software.
Tesla’s automotive business includes a lineup of battery‑electric vehicles and related services.
Further Reading Five stocks we like better than Tesla VIG, VYM, and VYMI: Which Vanguard Dividend ETF Is Right for You? 3 Closed-End Funds to Maximize Dividend Payments Rocket Lab’s Sell-Off Is Fading—Is It Finally Safe to Buy? $27 Billion in Buybacks: 3 Stocks Betting Their Strong Runs Aren’t Over
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On Aug. 19, 2026, Elon Musk posted on X: “China is also by far the strongest competitor in AI.” Three days later, a Chinese humanoid robot ran 100 meters faster than Usain Bolt’s world record at the Second World Humanoid Robot Games in Beijing.
On Aug. 22, 2026, Musk retweeted a post by Trung Phan reading: “Chinese humanoid robot by smartphone maker Honor (‘Lightning’) ran 100m in 9.32 seconds (Usain Bolt’s record is 9.58 seconds).” With that retweet, Musk amplified the result to his audience.
Musk’s Aug. 19 Post in Context Musk replied to tech commentator Brian Roemmele, who had resurfaced Musk’s 2011 prediction: “SpaceX has Boeing, Lockheed, Europe (Ariane) and Russia (Proton/Soyuz) near checkmate in rocket technology. End game is all about China.”. That framing has aged well. Chinese company LandSpace recently achieved the first successful recovery of its Zhuque-3 orbital rocket’s first stage, a step toward reusability that could pressure SpaceX (NASDAQ:SPCX | SPCX Price Prediction) in launch by roughly 2030.
Race Times, Precisely Three times are circulating and they differ. Tiangong Ultra, built by the Beijing Humanoid Robot Innovation Center, won an official preliminary heat in 9.39 seconds, beating Usain Bolt’s 9.58-second world record set in 2009. It stumbled afterward and crashed into a padded safety barrier. Tom’s Hardware reported a top speed of 23.8 mph. Honor’s “Lightning” finished the same heat in 9.47 seconds, then fell and was carried off on a stretcher. A Unitree robot finished the same heat far slower at 12.41 seconds. Lightning separately ran 9.32 seconds in a pre-Games test, not a competition result. That is the number Musk amplified.
The pace of improvement is striking. At last year’s inaugural Games, Tiangong Ultra won the same 100m in 21.50 seconds. A robot from Beijing-based X-Humanoid reached 2.88m in the standing high jump, beating the human record of 2.45m set by Javier Sotomayor in 1993. The Telegraph reported on Aug. 23, 2026 that a robot also beat the human 400m world record. The Games featured more than 2,000 humanoid robots across 51 events over five days. Experts caution that the technology remains largely at the demonstration and research stage.
Broader AI Evidence, Model by Model Chinese model releases have kept pace. Moonshot AI’s Kimi K3, launched July 16, 2026, was ranked by Arena.AI as the best model currently available, ahead of Anthropic, while reportedly performing close to Anthropic’s Fable 5 at a fraction of the cost. DeepSeek V4-Pro is priced around $0.87 per million output tokens versus roughly $50 per million output tokens for Anthropic’s Fable. Z.ai’s GLM-5.2 (June 2026) is noted for coding and creative-design strength at about $4.40 per million output tokens. Meituan’s LongCat-2.0 reportedly matched OpenAI and Anthropic’s February 2026 releases while training entirely on Chinese-made processors. On one platform in July 2026, Chinese models reportedly accounted for 57% of tokens used by US firms on OpenRouter, with Airbnb, DoorDash, Coinbase and Cursor cited as adopters. Model pricing moves quickly; these are point-in-time figures.
January’s Distinct Concession On Tesla’s January 2026 earnings call, Musk said something related but separate, specific to humanoid robots: “by far the biggest competition for humanoid robots will be from China. China is incredibly good at scaling manufacturing, actually quite good at AI… China will definitely be the toughest competition for Tesla.” He still frames Optimus in maximalist terms: “My prediction is that Optimus will be the biggest product of all time by far… Nothing will even be close.” Tesla plans to unveil Optimus 3 in a few months and eventually build a million units a year at Fremont. The Q2 2026 8-K showed record deliveries of 480,126 vehicles against a shrinking operating margin.
Optimus by the Numbers, and the US Response Tesla had shipped only about 150 humanoid units by January 2026, ranking 9th globally. Unitree and Agibot each individually sold more units in 2025 alone (roughly 5,500 and 5,168 respectively) than Tesla’s entire annual target. Chinese firms accounted for roughly 90% of global humanoid robot sales in 2025, per Rest of World. Separately, per an FCC order, Unitree, Agibot and UBTech together made up about 87% of global shipments as of January 2026. On July 28, 2026 the FCC banned new authorizations for foreign-made humanoid and quadruped robots, citing national-security and cybersecurity risk. The Pentagon separately added Unitree to a list of companies it deems tied to the Chinese military. China’s Foreign Ministry called the move an overstretching of “national security” and said “protectionism does not make the U.S. more competitive.”
Tesla (NASDAQ:TSLA) shares closed at $362.86 on Aug. 21, 2026, down 19.31% year to date. SPCX finished at $136.97, up 18.84% over the past month. The CEO of one of America’s marquee AI and robotics companies is now saying publicly what critics have argued for months, and the evidence keeps arriving fast enough to make the point for him.
Contact [email protected] for any questions or corrections.
The headlines will tell you that Tesla's (TSLA +5.14%) robotaxi rollout is behind schedule, and they would be partially right. It simply hasn't progressed along the lines indicated by CEO Elon Musk's previous pronouncements on the matter, and the stock has been punished for it. Still, I think there's plenty of data to suggest real progress in the rollout -- just not in the way many investors may have expected.
Rethinking Tesla's robotaxi rollout Many Tesla investors have focused on growth in fleet size and the number of cities where robotaxi is active as key markers of the rollout. They have good reason to do so, not least because Musk's previous comments during the rollout have encouraged them. Moreover, fleet size and cities are relatively easy to monitor, and information is readily available on social media.
Image source: The Motley Fool.
However, management has changed the narrative around the rollout. It's become abundantly clear that Tesla is focused on growing robotaxi miles driven (not the same thing as fleet size) and validating and releasing the next version of its full self-driving (FSD) software, v15, before moving to a wide-scale rollout. The good news is Tesla is making progress on v15 and already has early versions running in the robotaxi fleet.
That said, with v15 not expected to be released until the end of the year or early 2027, investors should not expect any kind of large-scale rollout until at least next year.
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Software and safety, not fleet size and cities As such, investors need to focus more on v15 development rather than purely monitoring fleet size and operational cities. This is somewhat problematic, as they will have to rely on management's updates on v15 rather than on easily observable data about the rollout. This feeling of flying blind while monitoring the rollout creates uncertainty and naturally increases the likelihood that investors will sell the stock.
However, I think that would be a mistake for two reasons. The first is the change in narrative over the stock, driven by management emphasizing v15 development rather than fleet size and expansion into new cities, has reset expectations such that any new developments on those matters could be taken positively by the market.
The second is that there is data on the rollout that we can monitor. What's more, it's actually very impressive.
Tesla's robotaxi safety data The National Highway Traffic Safety Administration (NHTSA) requires manufacturers to report crashes involving automated driving systems (ADS), which includes Tesla's robotaxi incidents. First, here's a look at the reported incidents, by month, since the rollout began last year.
Data source: National Highway Traffic Safety Adminstration. Chart by the author.
However, the raw data tells only part of the story, as most incidents are arguably not Tesla's fault. I previously discussed the NHTSA data through January. Most of the incidents were not Tesla's fault; in two cases, the teleoperator was responsible.
Tesla robotaxi incidents in 2026 So now I'll focus on the granular incident data for 2026, comprising 14 incidents. Eight of those were caused by the robotaxi being hit by another vehicle. Of the remaining six, two were minor incidents caused by the remote assistance operator. That leaves just four incidents to focus on.
Report ID
Incident Date
Precrash Speed
Narrative*
13781-13645
January
1 mph
The rear end made contact with a wooden pole while reversing out of a blocked alley.
13781-13646
January
2 mph
The right-rear tire made contact with a curb corner while reversing into an empty parking space.
13781-13644
January
4 mph
The ADS's left side mirror made contact with the tow truck's bed on a narrow street.
13781-15399
June
5 mph
The ADS made contact with a thin metal chain blocking the entrance to the parking lot.
Data source: NHTSA. *paraphrased by author for brevity.
Readers can decide for themselves whether this data is impressive. Frankly, I think it's very positive and a demonstration of Tesla's progress toward its safety goals.
What's next for Tesla's rollout? All of this is not to downplay the fact that Tesla is still refining v15, and nobody wants to see even very low-speed impacts with thin metal chains or wooden poles. Moreover, the data don't tell us anything about remote-assistance interventions.
Still, the data is excellent and encouraging for patient investors waiting for the robotaxi rollout to eventually scale.
The Space Exploration Technologies (SPCX +2.22%) IPO officially made Elon Musk a trillionaire. The SpaceX founder owns a substantial stake in the business, as well as a good chunk of the other trillion-dollar company he runs, Tesla (TSLA +5.14%). The two stock holdings have a combined worth of around $1 trillion, depending on what the market thinks of each stock on any given day.
Recent SEC filings revealed exactly how many shares of SpaceX Musk currently owns. That number is very important for investors in both of Musk's publicly traded companies, especially as the CEO pushes to merge the two into a single entity. Here's what the filings revealed and what it means for investors.
Image source: The White House.
SpaceX's SEC filings show Elon Musk effectively controls 6.4 billion shares of SpaceX as of the end of June. That's 48.4% of the entire company at the time of this writing.
Importantly, just 849 million of those shares are Class A. The rest are Class B shares (or restricted stock units or options). Class B shares have ten times the voting power of Class A shares. As a result, Musk controls over 85% of the total votes, allowing him to make business decisions unilaterally.
With so much voting power, SpaceX can make acquisitions with its stock, while Musk retains total control over the corporation. For example, SpaceX just closed its $60 billion acquisition of Cursor, the developer of the artificial intelligence (AI) coding agent. Even after the hefty acquisition, Musk's voting power will fall by less than a percentage point, even if all restricted stock units and options in the deal are fully exercised.
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Considering how little impact the Cursor acquisition had on Musk's voting power, he could make a much larger acquisition using SpaceX stock without losing control of the company. That's exactly why he may look to merge Tesla with SpaceX.
Musk has every incentive to merge his companies In early 2024, Musk said he wants about 25% of Tesla's voting power to push the company toward the future of AI and robotics. He held just under 20% of shares as of June.
Tesla signed a new incentive package with Musk last fall that rewards him with Tesla shares if the company reaches certain market values and other milestones. Some of those milestones would be considered accomplished if Tesla is acquired, and the market-value milestones will pay out based on the acquisition price. That means Musk can pay a significant premium for Tesla with SpaceX stock, resulting in him receiving more Tesla shares and, therefore, ceding less control than the acquisition price might imply.
He can, in fact, offer an incredible premium on Tesla shares without losing his majority voting power in the combined company. Tesla shareholders will be incentivized to vote for the merger if the premium is high enough, and Musk controls the vote for SpaceX. So, the decision to merge the companies is practically within Musk's control, assuming Tesla shareholder believe SpaceX shares will retain their value.
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That's not a great position for SpaceX shareholders. Paying a substantial premium for Tesla, which already trades at a high valuation, is unlikely to be in their best interest. We saw the same thing happen with the acquisition of xAI earlier this year, which seemed like a great deal for the AI company while significantly diluting value for existing SpaceX shareholders.
Of course, these are considerations that SpaceX investors already knew. The SEC filing detailing Musk's exact stake in SpaceX didn't reveal anything materially new to investors. Investing in SpaceX is investing in Musk's vision of the future, as the stock is currently valued based on expectations for substantial revenue growth and eventual profits and cash flow over the long run.
Given nothing more than the headline number, it would be easy to believe electric vehicle maker Tesla (TSLA +5.14%) is firing on all (proverbial) cylinders...at least within the United States. Although down slightly from the first quarter's 54.2% share of the U.S. electric vehicle market, Cox Automotive reported that the iconic EV brand accounted for 50.5% of the country's second-quarter EV sales -- as measured in units -- holding onto an industrywide majority reclaimed in the final quarter of last year for the first time since 2023.
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Now read the fine print. Tesla is only enjoying a market share advantage because its domestic rivals are suffering bigger EV sales setbacks than Tesla did. Total electric vehicle sales in the U.S. fell 20% during the second quarter, whereas Tesla's total unit sales fell 13% from 143,535 automobiles in the second quarter of last year to 124,800 units in Q2 of this year.
Losing share in other markets The United States isn't Tesla's only market. Europe and China are key electric vehicle markets as well, and the company's worldwide second-quarter total deliveries improved 25% year over year, to 480,126 automobiles.
Image source: Getty Images.
Even so, Tesla is losing market share in both of those markets, largely to China's BYD, but also to Chinese EV manufacturers Geely and Changan in China, and Volkswagen in Europe.
Of course, electric vehicles could soon be a secondary business for Tesla anyway. The company continues developing AI-powered humanoid robots that CEO Elon Musk has suggested could begin commercial production before the end of next year.
James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool recommends BYD Company. The Motley Fool has a disclosure policy.
When friends ask me if they should sell their shares in Tesla (TSLA +5.14%), I always get snarky and start by asking a different question: Do you still believe Tesla is one of the companies shaping the next decade of transportation, energy, and automation, or do you see it now as just another carmaker that had a good run?
Sure, I often ask if they think the ticker will run more, but my answer, looking out to 2027, is that the stock still has room to run, and that selling it just because the last couple of quarters were messy would miss what is actually happening inside the business.
Image source: Getty Images.
The headlines lately have not been kind, but this is investing; you must wait to time out your investments. Tesla's second-quarter results showed revenue of around $27 billion, with automotive sales up about 23% year over year, yet the operating margin compressed to near 1%, and profit missed expectations after a stretch of price cuts and heavy spending.
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Free cash flow even flipped negative as capital expenditures (capex) more than doubled sequentially, with guidance calling for more than $25 billion of capex for the year. On the surface, that looks like a company working harder for less earnings, which is why the stock has felt stuck.
But when I dig into the details, I see Tesla laying foundations rather than burning cash aimlessly. Vehicle production and deliveries in the first quarter continued to grow, with more than 408,000 units produced and 358,000 delivered. Energy storage deployments reached 8.8 gigawatt-hours, hinting at a growing business in grid-scale batteries and home storage that Wall Street often treats as a footnote.
Tesla's software push Most important to me, the software story is finally starting to match the hardware story. Subscriptions among current owners for its full self-driving (FSD) reached about 1.28 million active users in the first quarter, up roughly 51% from the prior quarter, and Tesla disclosed hundreds of millions of dollars in annual recurring revenue from FSD alone.
That revenue is tied to software running on cars already sold. Each new subscriber generates high-margin income without building another factory. If Tesla can keep growing that base and eventually turn FSD into a more-autonomous robotaxi platform, the earnings power attached to each vehicle could look very different from a traditional auto company.
Musk also has a swarm of fans There is also the Elon Musk factor, which you cannot ignore, whether you like him or not. His Space Exploration Technologies (SPCX +2.22%) went public in June 2026 at a valuation around $1.75 trillion and briefly traded over $2 trillion, and retail investors piled in so quickly that the stock became one of the most actively bought names in its first hours of trading.
Musk has an almost cultlike following among a certain slice of tech-focused investors who are willing to back his projects for long stretches as long as they see progress. That psychology affects Tesla. Many shareholders do not see this as just a car stock; they see it as a ticket on Musk's broader vision, and that long-term loyalty is one of the reasons management has been able to fund big bets on FSD, its Optimus humanoid robots, and new battery plants even when near-term margins are thin.
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So, should you sell? I think it depends on why you bought the stock in the first place. If you came in only for short-term multiple expansion and you now feel uneasy about margin pressure and capex, trimming might make sense.
But if you own the stock because you believe it will be one of the central platforms for electric vehicles, energy storage, and autonomous mobility by the early 2030s, the current volatility looks more like the price of admission than a reason to bail.
For my own portfolio, I am hoping to load up on Tesla into 2027 with the understanding that the stock will swing with every earnings report, or even a Musk tweet. Underneath that noise, there is a company adding hundreds of thousands of cars, millions of software subscribers, and gigawatt-hours of storage capacity while training huge AI models on real-world driving data. To me, that mix still has room to run.
Elon Musk is known for making bold moves. When it comes to Tesla (TSLA +5.14%), the big change he's implementing is a shift from making electric vehicles (EVs) to making humanoid robots. Tesla, however, still needs to make its EVs if it has any hope of supporting this massive business shift. Which is why the Model Y L is so important.
What is Tesla's big goal? Elon Musk has embraced the idea that autonomous devices are the future. To that end, he's pushed Tesla to develop self-driving cars. The company is currently working on autonomous taxi services, but self-driving electric vehicles have long been a key part of the company's technology push. The company has also been working on a humanoid robot, known as Optimus.
Image source: The White House.
To this end, the company has retooled its Fremont factory. It has ended production of the Tesla Model S and Model X, instead using the production lines to mass-produce Optimus robots. It is a bold bet, and it comes at a cost for the company: there will be fewer cars to sell. And while robotics may be the future, Tesla is still largely a car company at this point.
Will the Model Y L come to the rescue? The Model Y is Tesla's existing SUV vehicle. The Model Y L is an update that adds a third row of seats and a larger battery, giving it a longer range. It was first introduced in China, but has since been brought to other markets. This is where things get interesting for investors as they consider the impact of the updated Model Y on the company's financial results.
In Australia, the Model Y L accounted for more than half of the Model Y vehicles registered in July, according to industry watchers. Roughly 40% of the Model Y SUVs registered in New Zealand were the updated version, as well. There is clearly a demand for the product in Western markets.
Now, Tesla is bringing the Model Y L to the United States. U.S. consumers tend to like large vehicles, so it seems highly likely that the Model Y L will be a strong seller in the U.S. market, as well. Consumers also like new and improved products, so there's another positive here to push sales. And there could be an early burst of demand for a car already available in other markets, creating something of an exclusivity pitch for early U.S. customers.
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But will it reginite Tesla's sales growth? The answer isn't a clear yes. It may get customers excited about Tesla again, but the Model Y L is an expensive vehicle. That could put a limit on demand. And Tesla is already one of the most popular U.S. EV brands, so investors probably shouldn't get their hopes up on a massive growth spike.
Then there's the issue of the production halt for the Model S and Model X, which has to be factored in. While they were older models, the Model Y L has to offset the drop off from those two vehicles. It is more likely that the Model Y L simply supports current sales volumes and, perhaps, adds a little to sales growth. But that may actually be all that Tesla is looking for.
The Model Y L is part of a bigger plan At the end of the day, the Model Y L isn't likely to be a company-changing development. It is an incremental update to an existing product. Good, but not likely to spur massive sales growth. The company-changing shift is the transition to producing and selling Optimus robots. If the Model Y L makes that transition easier, then it will be a massive success. Early sales results in Australia and New Zealand suggest the launch of the Model Y L in the U.S. market could be just what Tesla is looking for.
Tesla announced Friday that it is recalling nearly three million vehicles in China over concerns that doors may be difficult to open in an emergency, marking the largest automotive recall in the country’s history.
Tesla’s action comes alongside recalls announced by eight other automakers, affecting a combined total of about 4.3 million vehicles in China.
Tesla’s recall is the largest, affecting approximately 2.98 million vehicles.
The US automaker said the recall covers imported and China-made Model 3, Model Y, Model S and Model X vehicles, according to notices filed with China’s State Administration for Market Regulation.
According to one of the recall notices, Tesla’s electronically operated, retractable door handles could become difficult to operate after a severe collision if the vehicle’s low-voltage system fails.
An aerial view of the Tesla Shanghai Gigafactory on March 29, 2021, in Shanghai, China. Getty Images
A Tesla Model S is seen at the 2018 Nantucket Film Festival on June 24, 2018, in Nantucket, Massachusetts. Getty Images for Nantucket Film Festival
A Tesla Model X is displayed during the Citi Taste of Tennis at Hyatt Regency Indian Wells Resort & Spa on March 5, 2018, in Indian Wells, California. Getty Images for Citi The company said the resulting problem “could hinder occupants from quickly opening the doors to escape and impede rescue efforts by those outside the vehicle, posing a safety hazard.”
To address the issue, Tesla said it would “affix warning labels” to affected vehicles and remotely upgrade its window-control software so the windows automatically lower following an accident.
Tesla also issued a recall addressing problems with driver-monitoring systems in certain vehicles, which are designed to help ensure drivers remain alert and ready to take control of steering or braking when necessary.
The automaker said it would provide a software upgrade and “in-cabin camera monitoring” to help drivers remain vigilant.
A Tesla Model Y is seen on a Tesla car lot on May 31, 2023, in Austin, Texas. Getty Images Tesla said it will contact owners of vehicles that cannot receive the fixes through remote software updates to schedule service appointments.
Other automakers announcing recalls included Xiaomi, Leapmotor, Xpeng and Geely Holding.
The National Highway Traffic Safety Administration said Friday that the automakers have not disclosed plans to issue similar recalls in the US.
President Trump and then-White House senior advisor, Tesla and SpaceX CEO Elon Musk deliver remarks next to a Tesla Model S on the South Lawn on March 11, 2025 in Washington, DC. Getty Images The announcement comes after Tesla issued two recalls in May.
The automaker recalled roughly 175 Cybertrucks over concerns that wheel studs could separate, potentially causing wheels to detach.
Tesla also recalled more than 218,000 Model 3, Model Y, Model S and Model X vehicles because of delayed rearview camera images that could increase the risk of a crash.
FOX Business has reached out to Tesla for comment.
Tesla announced Friday that it is recalling nearly 3 million vehicles in China over concerns that doors may be difficult to open in an emergency, marking the largest automotive recall in the country's history.
Tesla's action comes alongside recalls announced by eight other automakers, affecting a combined total of about 4.3 million vehicles in China.
Tesla's recall is the largest, affecting approximately 2.98 million vehicles.
The U.S. automaker said the recall covers imported and China-made Model 3, Model Y, Model S and Model X vehicles, according to notices filed with China's State Administration for Market Regulation.
TESLA FILES PLANS FOR PROPOSED $10.1B TEXAS SOLAR MANUFACTURING PLANT
Tesla is recalling nearly 3 million vehicles in China over concerns that doors could be difficult to open following a severe collision. (Michael Reynolds/Shutterstock)
According to one of the recall notices, Tesla's electronically operated, retractable door handles could become difficult to operate after a severe collision if the vehicle's low-voltage system fails.
The company said the resulting problem "could hinder occupants from quickly opening the doors to escape and impede rescue efforts by those outside the vehicle, posing a safety hazard."
To address the issue, Tesla said it would "affix warning labels" to affected vehicles and remotely upgrade its window-control software so the windows automatically lower following an accident.
Tesla also issued a recall addressing problems with driver-monitoring systems in certain vehicles, which are designed to help ensure drivers remain alert and ready to take control of steering or braking when necessary.
FORD BOOSTS US LINCOLN PRODUCTION AS IT PHASES OUT IMPORTS FROM CHINA
A Tesla Model 3 sedan pictured driving on a roadway. (Tesla)
The automaker said it would provide a software upgrade and "in-cabin camera monitoring" to help drivers remain vigilant.
Ticker Security Last Change Change % TSLA TESLA INC. 362.86 +17.73 +5.14% Tesla said it will contact owners of vehicles that cannot receive the fixes through remote software updates to schedule service appointments.
Other automakers announcing recalls included Xiaomi, Leapmotor, Xpeng and Geely Holding.
MORE THAN 20,000 OFF-ROAD MOTORCYCLES RECALLED OVER DANGEROUS BRAKE DEFECT THAT COULD LEAD TO DEATH
Tesla's recall covers certain imported and China-made Model 3, Model Y, Model S and Model X vehicles. (Tesla)
The National Highway Traffic Safety Administration said Friday that the automakers have not disclosed plans to issue similar recalls in the U.S.
The announcement comes after Tesla issued two recalls in May.
The automaker recalled roughly 175 Cybertrucks over concerns that wheel studs could separate, potentially causing wheels to detach.
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Tesla also recalled more than 218,000 Model 3, Model Y, Model S and Model X vehicles because of delayed rearview camera images that could increase the risk of a crash.
FOX Business has reached out to Tesla for comment.
It's been an interesting and mixed 2026 thus far for Tesla (TSLA +5.14%). While the stock has dropped almost 25% since January, the company's dominance in the U.S. electric vehicle (EV) market climbed to 59%, according to data from Cox Automotive. This is a level Elon Musk's company has not seen since 2023.
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The rebound in market share tells an interesting story for Tesla, which has battled an increasingly competitive yet challenging landscape, the expiration of the federal EV tax credit, and Musk's public image, which has hurt the brand. The overall American appetite for EVs has stalled, and legacy automakers have shifted gears back to gas-powered vehicles. The market-share dominance is both a sign of that retreat and of Tesla's competitive edge against pure-play rivals.
While the market share story is positive, there are still plenty of obstacles ahead for Tesla. The company's revenue increased 26% on a record number of deliveries, but profitability decreased. In fact, free cash flow turned negative as Tesla increased its funding of other ambitions, including artificial intelligence, Optimus, and robotaxis.
Image source: The Motley Fool.
This is a familiar conundrum for Tesla investors. The company remains a top player in the global electric vehicle market. Yet the investments in speculative ancillary businesses hurt margins and make investors nervous.
Tesla's core business remains strong even as BYD, Rivian, and other rivals intensify competition globally. What Tesla needs in the long run is for one of its other big bets, be it autonomous driving or robotics, to pay off, thereby justifying the increased pressure on the balance sheet and income statements. Until then, Tesla remains a wild card. It trades at a hefty premium as it shifts its priorities. Longtime investors have done well, but those looking to get in now should expect continued volatility as Tesla's AI projects iterate.
There's still potential upside, but also plenty of risk.
Catie Hogan has positions in Rivian Automotive. The Motley Fool has positions in and recommends Tesla. The Motley Fool recommends BYD Company. The Motley Fool has a disclosure policy.
The construction of Terafab, a semiconductor manufacturing plant that's part of a joint venture among Tesla (TSLA +5.14%), Space Exploration Technologies (SPCX +2.22%), and Intel, is integral to the investment case for the two Elon Musk-run companies. Not only is the initiative critical to supporting growth, but its successful implementation will significantly improve something that's too little discussed in the investment world -- it will derisk companies' supply chains and, therefore, their risk profile. Here's why.
Tesla and SpaceX's Terafab plans The Terafab initiative is massive. The first phase involves a $16.8 billion investment in a 100-million-square-foot semiconductor manufacturing plant in Grimes County, Texas. A multiphase build-out could ultimately amount to a $119 billion investment. It aims to produce 1 terawatt (TW) of compute, which is significantly larger than the current global supply, according to SpaceX.
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The fundamental rationale behind it is simple: Both companies need to develop and manufacture chips to support growth in their cost technologies, electric vehicles (EVs) and Optimus robots for Tesla, and AI compute and data centers for SpaceX.
Four key benefits of Terafab for Tesla and SpaceX First, Musk believes that its suppliers, such as Samsung, Taiwan Semiconductor (TSMC), and Micron, will not be able to produce enough chips to meet Tesla's demand alone, let alone SpaceX's.
Second, shifting chip production will help reduce the geopolitical risk inherent in reliance on chips manufactured in Taiwan. China views Taiwan as an integral part of Chinese territory and seeks to unify it with the mainland.
Third, vertically integrating chip production into its supply chain means Tesla/SpaceX will, in theory, save on the near-60% operating margins that suppliers like TSMC currently maintain.
Fourth, it's not just a question of securing a physical supply; the timing and flexibility of that supply are also critical for a manufacturer, as is the ability to custom-make chips.
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Why Tesla and SpaceX need Terafab Chips are an integral part of both companies' business. Tesla currently uses its AI4 chip in its EVs and will use AI5 for Optimus and data centers, with Musk arguing that, at some point, it will also be used in EVs as AI4 ages. The next chip, AI6, will also be used for Optimus and data centers. Samsung makes the AI4 chip, will make the AI5 chip, and will make the next chip, AI6. TSMC will also make the AI5 chip.
However, beyond those chips, Terafab will begin producing chips for Tesla and SpaceX, including those critical to the operation of SpaceX's data centers, whether orbital or on the ground.
Elon Musk: Image source: The White House.
What it means to Tesla and SpaceX investors Terafab won't be easy, as semiconductor manufacturing is complex and capital-intensive, and Tesla/SpaceX have no background in the industry. Moreover, there's a need for commercial agreements between Tesla and SpaceX regarding ownership and payment responsibilities at Terafab. Indeed, many investors believe these issues are key support for a Tesla/SpaceX merger.
Terafab comes with risk, but it could remove a huge amount of risk for both companies. Supply chains matter, and mitigating risk in a critical component like semiconductors is a major plus for stocks. That's the key point of the initiative.
Tesla (TSLA +5.14%), the leading global electric vehicle (EV) and energy storage manufacturer closed at $362.86, up 5.14%. Investors were encouraged by Nevada's permitting of paid robotaxi service as they watched the autonomous ride-hailing rollout progress.
Trading volume reached 58.5 million shares, coming in about 39% above its three-month average of 42.1 million shares. Tesla IPO'd in 2010 and has grown 22,721% since going public.
How the markets moved todayThe S&P 500 (^GSPC +0.43%) closed at 7,674, up 0.43%, while the Nasdaq Composite (^IXIC +0.43%) closed at 26,180, also up 0.43%. Among automotive and EV peers, Rivian Automotive (RIVN +6.00%) closed at $16.97, up 6.00%, and Ford Motor (F +3.00%) closed at $14.41, up 3.00%, with Tesla drawing extra attention thanks to robotaxi approvals.
What this means for investorsOfficials announced on Friday that the Nevada Transportation Authority has authorized three autonomous vehicle companies to offer passenger transportation using driverless cars within Clark County, which includes Las Vegas. Tesla has been permitted to operate a fleet of up to 5,000 fully autonomous vehicles in its first year, though it's unlikely the company will deploy that many.
Last week, reports said Tesla was preparing to launch its Cybercab in Austin later this month, beginning with rides for employees. Investors have been anticipating Tesla's fully autonomous ride-hailing fleet, and the stock is reacting to that progress.
Howard Smith has positions in Rivian Automotive and Tesla. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.
Tesla (NASDAQ: TSLA) stock finished Friday, Aug. 21, 2026, up 5.1%, on news that it received approval to bring its robotaxis to Las Vegas. The company also confirmed a European debut for its electric semi truck.
Both the S&P 500 and the Nasdaq Composite finished Friday up 0.4%.
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Clark County cleared Tesla for up to 5,000 robotaxis in Las Vegas On Thursday, Clark County, Nevada, cleared Tesla, Alphabet's Waymo, and Uber to begin running robotaxi services in Las Vegas -- driverless cars that pick up paying passengers with no one behind the wheel. Together, the three can put as many as 8,000 robotaxis on local roads over the next year.
But Tesla got the largest share of that by a wide margin -- its approval covers up to 5,000 vehicles.
Image source: Getty Images.
The stock also got a boost from the news that Tesla plans to show its new all-electric semi-truck at an international transportation expo in Germany as it gears up for a European launch.
Tesla's valuation leans on businesses that don't exist yet These are exciting developments, no doubt, but both projects remain in their development stages, far from true commercial deployment. Tesla's stock is too richly valued, and for my money, too much of that value is derived from lines of business that may never materialize.
Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.
After a week of the bond market yanking stocks around, Friday brought something rare: a relatively quiet day. Yields are still elevated, but they stopped lurching. The torrential flow of earnings reports slowed to a trickle.
The Dow Jones Industrial Average (^DJI +1.05%) leads at 0.89% as of 12:06 p.m. ET. The Nasdaq Composite (^IXIC +0.52%) is up 0.70% and the S&P 500 (^GSPC +0.46%) has added 0.68%. The gains put the S&P 500 on track for just its second up day in the six sessions since it set a record on Aug. 13.
^DJI data by YCharts
Calmer bond yields lift the stock market The whole week ran through the bond market, so it's fitting that a calmer bond market is what turned the beat around.
The 10-year Treasury yield is near 4.7%. That's still high, but it spent Friday bouncing in a narrow range instead of the wild swings that defined the earlier sessions. The calmer financing market gave the stocks most sensitive to interest rates some room to breathe.
The same easing lit a fire under assets that compete with bonds. Bitcoin (BTC +6.22%) jumped 5.9% and crypto-related stocks led the market. For instance, Robinhood (HOOD +12.71%) jumped 11.9% and Coinbase (COIN +7.56%) gained 9.2%. On top of the beneficial yield curve, crypto investors are applauding signs of clearer regulations as the Trump administration holds talks with several industry leaders.
Image source: Getty Images.
Gold rose 2%, as measured by the SPDR Gold Shares (GLD +2.03%) fund. Physical and digital gold are rising in tandem again. Is this the new normal for low-risk assets? Bitcoin investors have expected this kind of trend for years, yet few real-world examples exist. Nowadays, the matching gains are becoming less rare.
Tesla (TSLA +6.09%) was a notable single-stock gainer, up roughly 4%, lifting both the Nasdaq and S&P 500. Investors focused on forward catalysts, including Nevada's approval of up to 5,000 robotaxis in the Las Vegas area and an upcoming European launch of the Tesla Semi. At the same time, Wall Street seemed to ignore Tesla recalling millions of vehicles in China. The fixes involve software updates and warning stickers, so there's no huge financial hit expected. Still, two recalls of roughly 3 million Tesla vehicles each can't be good for Tesla's PR image in that massive market. The stock remains down about 21% for the year.
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Wall Street would like to forget this week It may sound strange to have bonds driving the action on the stock market, but that's the deal this week.
Long-term yields hit their highest since before the 2008 crisis, pushed up by ballooning deficits, a mountain of AI-related corporate borrowing, and a war that won't let oil prices settle.
Earnings provided a counterweight. Companies keep beating expectations, which is why stocks hit record highs this month. At the same time, some heavyweights crushed expectations but still suffered price cuts due to modest guidance or slowing growth trends. The earnings-and-revenue headline figures aren't always the whole story, and investors are paying close attention to forward-looking statements in 2026.
Commissioners of the Nevada Transportation Authority approved applications from Tesla Robotaxi, Waymo and Aviari Services to operate as autonomous vehicle network companies in Nevada. Under the approved orders, Tesla (TSLA) is authorized for a fleet of up to 5,000 fully autonomous vehicles during the first 12 months following issuance of its permit. Alphabet's (GOOG, GOOGL) Waymo and Aviari are each authorized for up to 1,000 fully autonomous vehicles during their respective first 12 months. <a class="reference_link" href="https://www.business.nv.gov/news-media/press-releases/2026/ntata/nevada-transportation-authority-approves-autonomous-vehicle-network-applications-for-tesla-waymo-and-aviari/" target="new">Reference Link</a>
Ark Investment Management's 13F filing for the second quarter showed that as of June 30, the investment firm held 2.76 million Tesla (TSLA +5.85%) shares worth approximately $1.16 billion. And though it reduced its position in the electric vehicle (EV) company slightly during Q2, Ark reportedly went right back to buying as Tesla shares fell, purchasing an estimated 450,000 shares worth roughly $170 million to $180 million between June 21 and Aug. 5. That's a pretty serious vote of confidence in a stock that's had a pretty bumpy year so far.
Through Aug. 19, Tesla was down roughly 23% year to date, leaving it in last place among the "Magnificent Seven." The gap isn't particularly close, either. Nvidia is up strongly for the year, while Amazon, Apple, and Alphabet are also sitting on double-digit percentage gains. Microsoft remains in positive territory, and even Meta Platforms -- the only other member of the group that is down in 2026 -- has lost less ground than Tesla. So why does Wood keep buying it?
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She's not betting on cars Here's the most important thing to understand about Ark's Tesla thesis: In Wood's view, it is not primarily an electric vehicle bet anymore. Ark's published valuation model gives Tesla a $2,600 per share price target for 2029, with a $2,000 bear case and $3,100 bull case. More importantly, Ark estimates that nearly 90% of Tesla's enterprise value and earnings could come from robotaxis by 2029. That's why its disappointing EV sales results haven't scared Wood away.
Tesla's EV deliveries actually improved substantially in Q2, rising 25% year over year to 480,126, the company's strongest second quarter ever. But profitability was another matter. Tesla reported $28.24 billion in revenue, but its adjusted earnings of $0.33 per share badly missed the $0.54 per share consensus estimate. Operating margin also fell to just 1.4% as the company continued spending heavily on AI, autonomy, and robotics.
Image source: Getty Images.
There's finally something tangible To Wood's credit, the robotaxi thesis isn't entirely theoretical anymore. Tesla launched its Robotaxi service in June 2025 and says it continued expanding and refining the service during the first half of 2026. The company also began production of its Cybercab model at Gigafactory Texas during Q2. Indeed, that is meaningful progress.
But there's an enormous difference between operating a growing autonomous ride-hailing service and building a business large enough to justify Ark's $2,600 price target on the stock. Ark's own model demonstrates just how dependent the valuation is on autonomy. Remove the robotaxi opportunity, and Ark previously estimated Tesla would be worth only about $350 per share in 2029.
If Tesla can scale up the production of the Cybercab, expand its Robotaxi network across major cities, win over enough riders, and eventually generate high-margin recurring revenue from autonomous transportation, Wood's decision to keep buying the stock amid this year's declines could look brilliant in retrospect. But if the robotaxi business takes longer to scale, encounters regulatory roadblocks, or doesn't generate the economics Ark expects, her valuation forecast becomes much harder to defend.
Tesla's energy storage business is growing, its Optimus robot business could eventually become meaningful, and its vehicle delivery volume has recently improved. But none of those businesses currently justifies a $2,600 stock price. Robotaxis do. And that's ultimately what you have to understand about Wood's $1.16 billion Tesla bet. She's not buying the worst-performing Magnificent Seven stock because she thinks its EV sales are about to explode. She's betting that Tesla will eventually become something much bigger than a car company. And if history serves as a reliable indicator, she's probably right.
Jeff Siegel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool has a disclosure policy.
Nearly a decade ago, Tesla introduced its solar roof, which was essentially a mini-power plant that happened to look like high-end shingles, fancy terra-cotta tiles, or refined slate slabs.
Now the solar roof is dead. Tesla has scrubbed public-facing mentions of the product from its website. TechCrunch has confirmed that the solar roof URL now redirects to its generic solar landing page on Tesla’s website, and all of the support pages redirect, too. Electrek was first to report on the product’s disappearance.
But like other Tesla initiatives, the concept might have a life beyond the company. Two solar installers told TechCrunch their company was still offering the solar roof, though one said availability would depend on the timeline of the project. That suggests Tesla is working to offload existing inventory.
Depending on how full that warehouse is, the solar roof might be available for some time. Tesla had lofty goals for the product, aiming for 1,000 installations per week, but after years of refinement and process improvement, the project got to somewhere between 20 and 40 per week as of 2022.
Tesla’s solar roof never had a bright future. From the start, it was positioned as a luxury product, and it only got more expensive over time. In its marketing materials, Tesla compared the solar roof with the cost of solar, plus roof replacement. That positioning made the product seem attractive, especially if you really didn’t like the looks of regular solar panels. But even when you factored in replacement, the product could be eye-wateringly expensive. People reported receiving quotes of $200,000 to install one.
Even as silicon-based technology got cheaper over time, the solar roof proved an aberration. Regular panels dropped in price because the world makes billions of standardized solar cells every year and assembles them into largely standardized panels. The solar roof might have used standard cells, but the tiles were unique to the system. That meant Tesla had to design and buy its own manufacturing equipment, and when sales didn’t materialize as expected, the per-unit cost of that equipment went up.
Physics wasn’t kind to the project, either. Anything that’s under full sun exposure has to deal with heat, and there were reports of the solar roof’s non-solar parts warping and roof underlayment melting. For Tesla, perhaps more troubling were reports of underproduction: The system wasn’t making as much electricity as Tesla said they would.
It’s hard to say what, exactly, resulted in the underproduction, but a likely culprit is heat. Like many electronic devices, solar panels perform better when they’re colder. Voltage tends to decline by about half a percent for every degree Celsius. Regular solar panels cope with this by leaving a gap between the panels and the roof, allowing for some airflow to cool things off. Tesla did the same with the solar roof, but the gap was much smaller, which may have led to high temperatures that robbed the cells of some efficiency.
So now that Tesla is pushing buyers to its traditional solar panels, does this spell the end of integrated solar roofs?
For now, no. Other companies like GAF and Merlin Solar are still angling for a piece of the market. Plus, it’s likely that a number of buyers with specific aesthetic tastes will keep companies interested.
Still, Tesla’s decision could deal a blow to the idea of a solar roof. If one of the world’s most valuable companies can’t make it work, who can? Maybe that’s an indictment of the entire concept. Or maybe it sounds like a challenge to an eager founder willing to prove Elon Musk wrong.
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Tim De Chant is a senior climate reporter at TechCrunch. He has written for a wide range of publications, including Wired magazine, the Chicago Tribune, Ars Technica, The Wire China, and NOVA Next, where he was founding editor.
De Chant is also a lecturer in MIT’s Graduate Program in Science Writing, and he was awarded a Knight Science Journalism Fellowship at MIT in 2018, during which time he studied climate technologies and explored new business models for journalism. He received his PhD in environmental science, policy, and management from the University of California, Berkeley, and his BA degree in environmental studies, English, and biology from St. Olaf College.
You can contact or verify outreach from Tim by emailing [email protected].
I initiate coverage on Tesla, Inc. with a Buy rating, citing strong revenue growth and developing catalysts. Operating markets of robotaxi, robotics, and AI remain tailwinds. TSLA delivered a 26% year-over-year revenue surge despite a 23% YTD stock decline. The EV business remains a leading one, but competition in the field remains fierce. Valuation remains elevated at 194x forward P/E, but TSLA has historically traded at a premium. However, macro headwinds and rumors around a merger with SPCX could result in volatility.
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Tesla (NASDAQ:TSLA | TSLA Price Prediction) and SpaceX (NASDAQ:SPCX) just gave investors two very different versions of the Musk future. Tesla posted record deliveries of 480,126 vehicles but watched operating margin collapse to 1.4%. SpaceX, fresh off its $85.7 billion IPO, grew revenue 92% year over year. The comparison is finally possible on the same terms.
One Business Is Investing, the Other Is Compounding Tesla’s quarter shows a company mid-transition. Revenue reached $28.24 billion, but EPS came in at $0.33 against a $0.5367 estimate, and free cash flow turned negative at $1.09 billion. CFO Vaibhav Taneja said plainly, “We are in a big investment cycle and expect our operating expenses largely driven by R&D to continue to grow in 2026 and beyond.” The $25 billion capital budget is going toward Optimus, Cybercab, a semiconductor fab, and AI compute.
SpaceX is spending even harder, but the return curve looks different. Capital expenditures hit $18.4 billion in a single quarter, with $15.8 billion of that supporting AI compute infrastructure. Adjusted EBITDA still climbed 191% to $3.5 billion. Starlink is the reason. Subscribers doubled to 12.0 million, and enterprise and government revenue grew 108% year over year, giving SpaceX a recurring revenue base Tesla still lacks outside FSD.
Where the Strategies Really Diverge Tesla is betting that autonomy converts its installed base into a fleet. FSD attach exceeded 55% of new North American deliveries, and Robotaxi now operates in seven U.S. metros. Musk keeps stretching the promise, saying the ideal target is “99.999999% reliable”. That standard reflects the difficulty of the problem, but it also means Robotaxi cannot scale within the timeline retail investors have priced in.
SpaceX is running a different playbook: launch a service that already works, then multiply capacity. Elon claimed Starlink V3 satellites are “about an order of magnitude more capable” than V2, and SpaceX plans to fly ten times as many.
Lens Tesla SpaceX Core Bet Autonomy and Optimus Starlink plus AI compute Q2 Free Cash Flow Negative $1.09B Funded by $100B cash Key Vulnerability Regulatory approval timing Starship execution What I’m Watching Into 2027 For Tesla, I want proof that unsupervised miles continue to compound at “more than 10% a week” without a serious incident. That growth curve would justify the P/E near 359x.
For SpaceX, the critical mass Elon cited is about 1,000 V3 satellites, which management targets around the second quarter of 2027. If that constellation arrives on schedule, the $100 billion annualized revenue run rate by year-end starts to look reachable.
Why I Lean Toward SpaceX Right Now On the metrics available today, SpaceX looks like the stronger setup. Tesla is trading on stories that Musk has been telling since 2019, and the stock is down 23.26% year-to-date because investors are noticing. SpaceX has the harder physics problem in Starship, but the connectivity business is already profitable and expanding into aviation, defense, and mobile markets. Management said, “We have never lost an enterprise customer.”
I would rethink this view if Robotaxi expands cleanly into ten more cities by early 2027, or if Starship suffers another setback that pushes V3 deployment out. Until then, SpaceX is the Musk bet with the shorter distance between promise and cash flow.
Contact [email protected] for any questions or corrections.
Tesla is voluntarily recalling about 3 million vehicles in China to address two separate safety issues, the latest setback for the company as it tries to remain a major player in the world's largest auto market.
One recall involves Tesla's doorhandles, which are electronically operated and retractable, and the other is tied to the company's driver "attention monitoring" systems, according to notices published on Friday by Tesla and China's product safety regulator.
Tesla said in a doorhandle recall notice that severe collisions can cause the "vehicle's low-voltage system to fail," and that resulting doorhandle problems "could hinder occupants from quickly opening the doors to escape and impede rescue efforts by those outside the vehicle, posing a safety hazard."
The company said it plans to "affix warning labels" to recalled vehicles, and will upgrade its "window control software" with an over-the-air update so that windows automatically lower after an accident is detected. Model 3, Model Y, Model S and Model X vehicles, including some imports and those made in China between March 4, 2019, and April 29, 2026, are subject to the recall.
The Model Y is one of the best-selling vehicles in China, but Tesla faces intensifying pressure there from local competitors, including BYD and Xiaomi, that are are making more affordable and innovative electric cars. According to China Passenger Car Association data, Tesla delivered 25,158 Model Y units in China in July, down 18% from 30,766 a year earlier.
The flush doorhandles that Tesla popularized are featured on cars made by Tesla competitors like Xiaomi, Geely and others that also issued recalls in China on Friday. Deaths apparently caused by malfunctioning or inaccessible doorhandles, have led to regulatory changes in China, prompting the widespread recalls involving nine automakers.
Regulatory changes are also being considered in the U.S. The National Highway Traffic Safety Administration said in July that it would begin the process to establish a new federal rule to "mandate a robust and obvious door egress system in all motor vehicles," according a regulatory filing.
Tesla's other recall on Friday is to address deficiencies in some of its vehicles' driver monitoring systems, which are meant to ensure drivers stay attentive and ready to take over steering and braking at any time while using partially automated driving features like autosteer.
In a recall notice, Tesla said it would provide customers with free over-the-air software updates, and add "in-cabin camera monitoring" alongside its steering-wheel based torque sensors to prompt drivers to stay more engaged, and take over steering and braking when needed.
For vehicles that can't be upgraded via over-the-air software updates, Tesla's recall notice said its service centers will "contact relevant users" to book repairs.
The second recall applies to China-made Model 3 and Model Y vehicles manufactured between March 4, 2019, and December 7, 2025.
The Chinese government announced its biggest car recall ever on Friday, forcing nine automakers to address the dangers of retractable door handles popularized by Tesla particularly for electric cars.
The recall involves 4.3 million vehicles. Most of the automakers, including Tesla, will attach stickers to their cars to show where the handles are located. Tesla will also push online software updates to the cars so their windows will open automatically after a crash.
Concerns about the doors have also flared in the United States, where families have sued Tesla, claiming its design was defective and led to the deaths of people who could not exit the company’s cars after accidents.
China’s State Administration of Market Regulation said Friday that Tesla and eight Chinese automakers — Geely, Dongfeng, Xiaomi, Chery, Beijing Automotive, First Auto Works, Leapmotor and Xpeng — would each be conducting recalls. The largest of them by far will be by Tesla, covering almost three million cars, with the other manufacturers recalling a total of 1.3 million cars.
Tesla has long been one of the biggest sellers of electric vehicles in China.
The recalls follow growing public anger in China about cases when drivers and passengers, as well as rescuers, had trouble finding and operating interior and exterior door handles during fires. Fires have been a problem in some electric cars, particularly older models that used less stable battery chemistries that are prone to extreme overheating after collisions.
In early February, Chinese regulators banned fully retractable door handles from new cars starting next year. Many of these handles are powered, prompting concern about whether they will work when the car suffers an electrical failure, as can occur following a crash.
Chinese regulators have allowed the continued installation of semi-retractable door handles that do not become flush with the vehicle’s surfaces. In the United States, the National Highway Traffic Safety Administration has begun drafting new regulations as well.
A door for a Tesla Model YL electric vehicle at a showroom in Beijing in February. — Pedro Pardo/Agence France-Presse — Getty Images
A video was widely circulated in China this year of a Dongfeng electric car that slid into a fence in southwestern China and caught fire following a collision with a truck. The driver exited, allowing his door to close behind him, but then had great difficulty opening any doors to extricate his passengers. He was eventually able to do so with the help of another motorist.
The crash, which left his passengers with burn injuries, took place in March 2025 but did not become widely known until this year.
Tesla popularized retractable door handles as providing a more streamlined look, although automotive engineers have said that the actual gains in aerodynamic efficiency are modest. Chinese makers of electric cars quickly followed suit as they rapidly expanded from 2020 onward.
Many electronic door latches rely on a 12-volt battery that is separate from the high-voltage battery that drives the motors of electric cars. If the power from that smaller battery is cut off by a crash, the electronic door mechanism may not work. And people in the car may not be able to quickly find manual door latches, which are often not installed in the same area as the electronic mechanisms.
Tesla did not respond to a request for comment.
Fully electric cars and plug-in gasoline-electric cars represented three-fifths of the cars sold in China last month, as China leads the world in adoption of electric automotive technology. David Zhang, the dean of vehicle technology research at the Jiangxi New Energy Technology Institute, said the enormous recall showed China’s readiness to set safety standards for electric cars.
“Automotive quality and safety issues have been improved through repeated updates,” he said.
In the United States, lawsuits and news coverage about electronic doors have prompted federal regulators to begin drafting new rules, a process that could take many months and would apply to new cars several years hence.
In California, Tesla faces lawsuits by the parents of two college students who died inside the company’s Cybertruck after the pickup crashed into a tree in Piedmont, an affluent suburb in the San Francisco Bay Area, in 2024.
The young people were unable to escape the burning vehicle, the suit claims, because the electronic doors were disabled in the crash, and it was too difficult to find manual release mechanisms.
Tesla is contesting the suit, arguing in court filings that the victims’ own negligence caused their deaths. A jury trial has been scheduled for next year, according to court records.
The automaker on Friday also announced a separate recall of 2.74 million cars in China to enhance the capacity of its cars to monitor whether drivers are paying attention to the road in front of them while automated driving systems are engaged. Tesla will transmit software to all of the recalled cars so that the cameras can more reliably monitor drivers’ eye movements and overall alertness.
Many established Western and Asian automakers, including BMW, Ford Motor and Hyundai, have also started installing electronic doors, including in some cases on fossil fuel and hybrid models.
shares gained about 3%on Friday as investors assessed the company's plans to bring its electric Semi truck to Europe, following a company post outlining its appearance at September's IAA Transportation show in Hannover.
Tesla is expected to provide details on European availability and vehicle specifications at the industry event. The move gives the company a potential entry point into a commercial-vehicle market where electric truck adoption remains limited.
The European push comes shortly after Swedish logistics company Einride placed an order for 500 Semi trucks. Tesla began producing the vehicle at its Nevada plant in 2026, with the facility designed to handle as many as 50,000 trucks annually.
Despite the latest gain, Tesla remains under pressure in 2026, with shares down about 23% year to date. Investors continue to weigh the company's electric-vehicle business against its developing autonomous-driving and robotics initiatives.
European Semi expansion could provide a new growth avenue, but adoption and production scale remain key factors for investors.
