The TL;DR
Musk told investors that Optimus has no inventory and all parts are new, as Tesla quietly dropped the language of mass production on its Q2 deck.
Elon Musk told investors on Tesla’s second quarter call that the Optimus will be “.the most difficult product to measure production that we have ever done at Tesla,” caveat that the humanoid robot has no existing inventory and that all parts are new. He said he wanted “to measure people correctly” on expectations, acknowledging that the initial production ramp will follow a normal curve but with an early expansion that may last longer than investors hoped.” Tesla also quietly removed references to Optimus mass production from its Q2 shareholder presentation, after using that language as recently as the first quarter.
The admission marks a sharp change in tone from previous quarters. Last year Musk said he would “scared” if Tesla does not produce 100,000 Optimus robots per month within five years, and by January 2025 it makes 50,000 units to 100,000 units by the year 2026. Fremont and Gigafactory in Texas collect data for training rather than performing production tasks.
Musk was right about the engineering hurdles, saying that Optimus needs at least human-level intelligence before it can be useful outside of controlled factory settings and calls for a human hand.”wonderful thing” that no other robotics company has been able to replicate. Tesla must also solve the challenges of packaging memory, logic, and chips while securing AI processors from partners that include Samsung and TSMC. The robot consists of nearly 10,000 unique parts, and unlike Chinese competitors that cannot tap into the existing smartphone supply chain for actuators and a motorscratch manufacturing base, the foundation for construction of Tech.
💜 for EU tech
The latest talk from the EU tech scene, a story from our genius founder Boris, and some incredible AI art. It’s free, every week, in your inbox. Register now!
The financial situation adds to the pressure. Tesla reported Q2 revenue of $28 billion, up 26 percent, but adjusted earnings of 33 cents per share missed the 51 cents analysts expected, and operating income fell 57 percent. Capital spending fell to about $6 billion in the quarter, part of Tesla’s $25 billion capital spending plan, pushing free cash flow to $1 billion and sending shares down nearly seven percent in premarket trading on Wednesday.
Musk’s compensation deal includes part of his payment for delivering one million Optimus robots over a decade, a target that has now come unstuck against his own warnings about how difficult it would be to scale. Tesla has converted its Fremont Model S and Model X Optimus production lines and built a dedicated facility near the Gigafactory in Texas, but the company stopped short of promising when volume production would begin. Tesla’s China president has described the Shanghai Gigafactory as the “golden key” to mass-producing Optimus, although that factory has not yet started producing the robots.
