Musk: Humanoid robots are the most difficult product in Tesla’s history to be mass-produced
Tesla continues to promote large-scale expansion and its capital expenditures have increased significantly. This trend has attracted widespread attention from investors. On July 23, Beijing time, Tesla announced its second quarter 2026 financial report, which showed that the company achieved revenue of US$28.236 billion in the second quarter, a year-on-year increase of 26%; net profit attributable to common shareholders was US$1.114 billion, a year-on-year decrease of 5%.
Tesla continues to promote large-scale expansion and its capital expenditures have increased significantly. This trend has attracted widespread attention from investors. On July 23, Beijing time, Tesla announced its second quarter 2026 financial report, which showed that the company achieved revenue of US$28.236 billion in the second quarter, a year-on-year increase of 26%; net profit attributable to common shareholders was US$1.114 billion, a year-on-year decrease of 5%. Tesla stated that it will continue to promote the construction of infrastructure and AI software in the second half of 2026 to lay the foundation for the accelerated growth of electric vehicle demand, Tesla Robotaxi (unmanned online ride-hailing service) and the production of humanoid robots. During the earnings call, Musk mentioned, “We are massively expanding our advanced infrastructure manufacturing capabilities, which we believe will be the largest in history.” Humanoid robots: no ready supply chain, difficult to mass produce Musk said at the conference call that the mass production of humanoid robots is "the most difficult product in Tesla's history" because almost all components of humanoid robots are brand new and there is no ready-made supply chain, and a large number of links can only be completed within the company. "Everything on the robot is new," Musk said. "With electric cars, Tesla can source specific parts like wheels, side mirrors and windshields from existing suppliers; but with Optimus, there is no supply chain." In terms of production capacity, Tesla's previous news showed that as the last batch of Tesla Model S/X rolled off the assembly line at the Fremont factory in California, the factory's original Model S/X production line was transformed into a dedicated production line for Tesla humanoid robots, with a planned annual production capacity of 1 million units. At the same time, Tesla is preparing the second production line of robots at the Texas Gigafactory. Its long-term design annual production capacity is 10 million units and is expected to be put into production around next summer. Tesla's artificial intelligence strategy for humanoid robots is exactly the same as the end-to-end strategy adopted for assisted driving - input pixels, output control. Tesla expects humanoid robots to have broad applicability, as well as assisted driving. The first batch of Tesla humanoid robots will be used in the Tesla Optimus Academy to collect training data and further develop new features. Terafab chip factory: site selection may be announced soon Musk emphasized that in order to achieve large-scale mass production of Optimus, the Terafab chip manufacturing plant must be established. The company will deploy a number of "high-risk, high-return" AI chip projects to serve humanoid robots. He mentioned that Tesla is expected to announce the location of the Terafab chip factory "soon". The factory will be built in partnership with SpaceX. Some investors asked whether suppliers would jointly invest in the development of Optimus with Tesla. Musk responded that suppliers have invested heavily in supporting the Robotaxi and Optimus projects, mentioning TSMC, Samsung and Panasonic. In addition, Musk also revealed that storage manufacturer Micron has supplied Tesla with a considerable number of memory chip quotas under reasonable supply conditions. The financial report shows that in the first half of 2026, Tesla’s local computing power in Texas will more than double. The Tesla Cortex 2 computing power cluster supports the development of autonomous software for electric vehicles and humanoid robots, and will continue to increase its scale this year. Tesla revealed that the design of the next-generation AI 5 inference processor chip has been completed, and the chip will be mainly used in humanoid robots and data centers. Because AI 4 hardware can already achieve unsupervised autonomous driving that far exceeds human safety levels, there is currently no urgent need for AI 5 to enter the vehicle system. Musk called the AI 5 chip "currently the most outstanding AI inference chip in the field of edge computing" and revealed that it has accumulated strong momentum for the design work of AI 6. Big year for capital spending: Expected to exceed $25 billion for the full year In terms of capital expenditures, Tesla still expects capital expenditures to exceed US$25 billion in 2026, and believes that capital expenditures will continue to increase in the next two to three years. With an eye on a future driven by AI and robotics, Tesla's capital expenditures increased to $5.8 billion in the second quarter, causing its free cash flow to turn negative for the first time in two years.
When asked about the capital efficiency issues brought about by Tesla's huge capital expenditures this year, Musk said the first priority is to get things done quickly. As always, he advocated investing the necessary funds to achieve the goals. He also said that Tesla should complete capital expenditures as quickly as possible without waste, and that slightly lower capital efficiency is acceptable if the task can be completed faster. "This is a big year for capital expenditures, but I believe that all the projects we invest in will generate incredible returns." Musk emphasized. However, some analysts believe that some investors originally expected that its investment cycle was close to peaking, but the signal released by management is that Tesla is still in "construction mode", and investors may question whether this round of capital expenditure cycle can create huge value. Tesla and SpaceX merge? Musk said he couldn't discuss it Regarding the merger of Tesla and SpaceX, which is the most concerned issue in the market, Musk said that he could not discuss merger-related matters during the earnings call, but pointed out that the business overlap between the two companies is deepening, "As you can see from Tesla and SpaceX's multiple cooperation in many fields, the overlap between the two parties is increasing." Previously, the market had been speculating on the possible merger of Musk's two companies, and relevant discussions intensified after SpaceX's record-breaking $75 billion IPO.
When asked about the capital efficiency issues brought about by Tesla's huge capital expenditures this year, Musk said the first priority is to get things done quickly. As always, he advocated investing the necessary funds to achieve the goals. He also said that Tesla should complete capital expenditures as quickly as possible without waste, and that slightly lower capital efficiency is acceptable if the task can be completed faster. "This is a big year for capital expenditures, but I believe that all the projects we invest in will generate incredible returns." Musk emphasized. However, some analysts believe that some investors originally expected that its investment cycle was close to peaking, but the signal released by management is that Tesla is still in "construction mode", and investors may question whether this round of capital expenditure cycle can create huge value. Tesla and SpaceX merge? Musk said he couldn't discuss it Regarding the merger of Tesla and SpaceX, which is the most concerned issue in the market, Musk said that he could not discuss merger-related matters during the earnings call, but pointed out that the business overlap between the two companies is deepening, "As you can see from Tesla and SpaceX's multiple cooperation in many fields, the overlap between the two parties is increasing." Previously, the market had been speculating on the possible merger of Musk's two companies, and relevant discussions intensified after SpaceX's record-breaking $75 billion IPO.