Tesla begins Optimus humanoid robot production in California factory

Optimus Robot Production Begins

Tesla announced it has commenced production of its Optimus humanoid robot at its factory in Fremont, California. The manufacturing space previously produced electric vehicles. The company stated these are the first production-quality bots manufactured, indicating a step towards commercialization.

Production Outlook and Challenges

Tesla CEO Elon Musk described the current phase as "early production," anticipating a slow and "somewhat bumpy" ramp-up due to the product's novelty. He projected a production rate of 20,000 units per week by the end of 2027. Musk also noted that design tweaks are still necessary to ensure safety, reliability, and durability, and significant AI development is required for the robots to perform open-ended tasks effectively.

Financial Impact of Development

The investment in Optimus robots, AI, and autonomous driving contributed to a 43% drop in Tesla's third-quarter profits. The company's revenue remained flat, with increased expenses offsetting sales. Total third-quarter revenue was $28.04 billion, slightly below the previous quarter and the same period last year.

Revenue Streams and Declines

Electric vehicle sales primarily drove Tesla's revenue, remaining flat year-over-year at $20 billion, with 486,532 vehicles delivered in Q3. The solar and energy storage business experienced a 16% year-over-year decline to $2.8 billion, attributed to tariff-related customer refunds. Conversely, the services business, including Full Self-Driving subscriptions, grew 33% year-over-year, generating $4.6 billion.