Latest news with #DojoSupercomputer
Yahoo
4 days ago
- Automotive
- Yahoo
Tesla Has a Leg Up on Self-Driving Car Competitors, Says Goldman Sachs Ahead of Robotaxi Launch
Tesla shares rose on Tuesday in anticipation of the launch of the EV maker's robotaxi service in Austin, Texas, later this week. Tesla has two potential advantages in the autonomous vehicle market, according to Goldman Sachs analysts: low hardware costs and the ability to scale quickly with AI-powered self-driving software. Goldman joined other Wall Street firms on Tuesday in questioning the viability of CEO Elon Musk's ambitious targets for the robotaxi investors on Tuesday were putting last week's feud between CEO Elon Musk and President Trump in the rearview mirror and looking ahead to what they hope will be the EV maker's next growth driver. Tesla (TSLA) shares surged Tuesday, rising nearly 6% for their third straight day of big gains, in anticipation of the launch of its robotaxi service in Austin, Texas. The company expects to operate 10 to 20 vehicles starting this week, and grow the fleet in the coming months. Goldman Sachs analysts in a note on Tuesday said the EV maker could have two advantages in the AV market. First, the scale of its existing business and certain design choices—Tesla uses custom silicon and does not use lidar or radar to navigate—could make its vehicles significantly less expensive than the competition. Second, its 'end to end AI training approach' could facilitate faster scaling by creating an adaptable software that uses reasoning, not programming, to understand new environments. Tesla has set aggressive scaling targets for its AV business. The company plans to enter markets beyond Austin before the end of the year, and CEO Elon Musk expects to have 'hundreds of thousands' of AVs on the road by the end of next year. Tesla expects operating costs at scale to be about 40 cents per mile. Goldman Sachs has more modest expectations. The firm estimates the average AV's depreciation, insurance, and remote operator costs currently total about $1.34 per mile, and they don't expect those costs to decrease to 40 cents until about 2040. They also expect Tesla will have about 2,500 robotaxis in service by the end of 2027. Goldman is not alone in thinking Tesla's targets are unrealistic. Baird downgraded Tesla stock on Monday, citing 'lofty expectations' as a primary reason. 'We believe Musk's comments regarding the robotaxi ramp rate are a bit too optimistic, and we believe this excitement has been priced into shares,' wrote research analyst Ben Kallo. A lot is riding on the success of Tesla's robotaxi service. Musk has been insisting for more than a year that Tesla's core business is AI and robotics, not cars. The company began production of its Dojo Supercomputer in 2023, and in 2024 began prioritizing its robotaxi service over the development of a low-cost, human-driven EV model. Anticipation of the robotaxi rollout has buoyed Tesla's share price ever since despite mounting troubles. Sales slumped in the first quarter amid increased competition and a consumer backlash to Musk's work with the Trump administration. The stock lost more than half of its value between hitting an all-time high in December and early April when stocks nosedived after Trump unveiled steep tariffs on most of the world's goods. Shares rebounded in late April and May after Musk promised to spend less time in Washington. But the stock took another hit earlier this month when Musk and the president sparred online over the impact the tax bill working its way through Congress could have on America's fiscal deficit. The public spat jeopardized Musk's amiable relationship with the president, which was a key reason many Tesla investors looked past weak sales and an uncertain outlook. Gene Munster and Brian Baker of Deepwater Research said in a note last week they do not anticipate Musk's feud with Trump will derail Tesla's AV leadership. The White House, they said, "has little to gain in standing in front of autonomy" considering the race between the U.S. and China to be the global leader in artificial intelligence. "The bottom line, [we] expect cooler heads to prevail and the Federal Government will continue to support the growth of these services." Read the original article on Investopedia
Globe and Mail
25-03-2025
- Automotive
- Globe and Mail
Commerce Secretary Howard Lutnick Says You Should Buy Tesla Stock
Tesla (TSLA) CEO Elon Musk recently got a ringing endorsement from Commerce Secretary Howard Lutnick, who urged investors to buy the dip in the company's stock. In an interview with Fox News, Lutnick said, 'If you want to learn something on this show tonight, buy Tesla. It's unbelievable that this guy's stock is this cheap. It will never be this cheap again when people understand the things he is building.' With the stock down 31% on a YTD basis, the risk-reward balance may have finally turned favorable, especially for long-term investors. About Tesla Stock One of the most consequential companies of the 21st century, Tesla is a leader in the global electric vehicle (EV) market with an increasing focus on artificial intelligence (AI), humanoid robots and energy storage solutions. The company currently commands a market cap of about $800 billion. Helmed by Elon Musk, Tesla shares have been a bonafide wealth creator for its investors, surging by 625% over the past five years. Despite falling short of revenue and earnings expectations in the latest quarter, Tesla still posted growth. The company's revenue rose by 2% year-over-year to $25.71 billion, while earnings climbed by 3% to $0.73 per share, missing the consensus estimate of $0.75. Although the decline in vehicle deliveries was seen as a setback, several other key performance indicators showed encouraging growth. Tesla reported year-over-year increases of 17% in charging stations and 19% in connectors, bringing the totals to 6,975 and 65,495, respectively. Net cash generated from operating activities reached $4.8 billion, exceeding the previous year's $4.4 billion, despite a slight dip in free cash flow to $2.03 billion. By the end of the year, Tesla held a robust cash balance of $36.6 billion, comfortably surpassing its short-term debt of $14.9 billion. Now, coming back to Lutnick's comments, are the 'things' that Musk is 'building' exciting enough to warrant an investment in the stock at the current juncture? Let's have a closer look. Dojo Supercomputer Morgan Stanley is of the opinion that Tesla's Dojo Supercomputer can propel the company's value higher by a sizeable $500 billion. As I highlighted previously, the Dojo Supercomputer is Tesla's custom-built AI training supercomputer, designed to process vast amounts of video data for autonomous driving. It plays a critical role in training Tesla's Full Self-Driving (FSD) system by analyzing real-world driving scenarios. Dojo, which has been in the works since 2019, was unveiled finally during Tesla's AI Day in 2021. Tesla's Dojo supercomputer capitalizes on an extensive collection of real-world driving data gathered from its global fleet to enhance the efficiency and safety of its Full Self-Driving (FSD) technology. Beyond refining autonomous driving capabilities, the vast datasets processed by Dojo serve a pivotal role in advancing Tesla's Optimus humanoid robotics project, further underscoring the company's push into cutting-edge artificial intelligence and automation. Optimus Musk forecasts that Tesla's humanoid robot Optimus has a revenue potential surpassing $10 trillion — an outlook that underscores the sheer scale of the opportunity ahead. I have covered Optimus here, noting that 'Optimus is designed to integrate seamlessly into existing workflows without requiring major overhauls.' Moreover, Musk has projected that once Tesla's annual production of Optimus robots surpasses 1 million units, the cost per unit is expected to fall below $20,000. The company intends to introduce several thousand units this year, with production scaling up significantly in the subsequent period. In the initial phase, these robots will be integrated into Tesla's own operations, enhancing efficiency across multiple departments and streamlining various internal processes. Additionally, an updated version of Optimus bots is expected to be unveiled later this year, which is said to include undisclosed upgraded capabilities. Energy Storage Tesla's burgeoning energy business is another vital cog in its flywheel. As stated in this earlier piece of mine, Tesla is steadily broadening its global footprint in energy operations, with a strong emphasis on solar solutions and the deployment of Megapack systems. To drive this expansion, the company has established new manufacturing facilities in Shanghai and Texas. The Texas plant notably features a 50,000-GPU compute cluster designed to lower operational costs and reduce reliance on external computing services. This proprietary infrastructure is set to accelerate the progress of Tesla's Full Self-Driving (FSD) technology, support the development of its Optimus humanoid robot, and further enhance the integration of its hardware and software ecosystem. Vehicles And now comes the biggest revenue generator for the company, its autonomous vehicles. The company's market dominance, along with the introduction of new models such as the refreshed Model Y, is expected to fuel growth in sales, deliveries, and profitability. Notably, Tesla announced in March that it had secured 200,000 orders for the updated Model Y in China. This surge in demand stands out as a positive development amid slowing sales in the world's second-largest economy, where increased competition and tariff challenges have weighed on the broader automotive market. In response to shifting market conditions, Tesla is actively pursuing cost reductions to make its vehicles more affordable. The company's Shanghai team is already working on a revised version of the popular Model Y SUV, aiming to reduce production expenses by 20% to 30%. This cost-cutting initiative is expected to enable Tesla to offer a more competitively priced vehicle that can better challenge cheaper electric alternatives offered by Chinese automakers. As part of its strategy to boost adoption, Tesla is also providing a one-month free trial of its Full Self-Driving (FSD) technology in the region. With these strategic moves and the absence of comparable electric vehicle alternatives in the U.S. market, Tesla is well-positioned to maintain its leadership in the EV industry for the foreseeable future. Analyst Opinions on TSLA Stock Overall, analysts have deemed the stock a 'Hold' with a mean target price of $338.94 which indicates upside potential of about 21% from current levels. Out of 40 analysts covering the stock, 15 have a 'Strong Buy' rating, three have a 'Moderate Buy' rating, 12 have a 'Hold' rating and 10 have a 'Strong Sell' rating.
Globe and Mail
21-03-2025
- Automotive
- Globe and Mail
Is Tesla Stock a Buy on Elon Musk's Plans to Send Optimus to Mars?
Elon Musk has no shortage of ambitions, with involvement in everything from self-driving cars to his new role in the federal government. However, there are two projects that he is particularly passionate about: populating Mars and Optimus, Tesla's (TSLA) humanoid robot. And in a recent interview with Fox News, Musk shared how he plans to bring the two together by confirming that SpaceX's Starship will depart for Mars at the end of 2026 with Optimus on board. But what does all this mean for Tesla stock investors who have been burnt by a 42% drop in the share price in 2025? About Tesla Stock With Musk at the helm, Tesla currently commands a market capitalization of $758.6 billion. The company has been a true wealth creator, with shares up more than 585% over the past five years. Plus, the company has grown its revenue at a compound annual growth rate (CAGR) of 32% over the same time period. And although Tesla missed revenue and earnings expectations for the fourth quarter of 2024, the company still delivered year-over-year growth. Revenue was up 2% to $25.71 billion while earnings rose 3% to $0.73. The company generated $4.8 billion in net cash from operating activities in Q4, exceeding the prior year's $4.4 billion, although full-year free cash flow saw a slight decline to $2.03 billion. Notably, with the Dojo Supercomputer and Tesla's recent foray into ride-hailing in California expected to drive significant growth for the company, how does Optimus fit in? And what does the latest Mars news mean? Let's have a closer look. Musk Convinced About Optimus Elon Musk envisions Tesla's Optimus humanoid robot as a game-changer, with a revenue potential surpassing $10 trillion — an outlook that underscores the sheer scale of the opportunity ahead. Musk has stated that once annual manufacturing reaches 1 million units, the cost per unit will likely drop below $20,000. In line with this vision, as stated in my previous article, Tesla plans to roll out several thousand Optimus robots this year, with a significant ramp-up in production thereafter. Initially, these robots will be deployed within Tesla's operations, improving efficiencies across various departments and processes. Optimus is designed to integrate seamlessly into existing workflows without requiring major overhauls. Tesla is leveraging imitation learning through teleoperation, motion capture, and VR-based demonstrations, allowing the robots to intuitively perform tasks traditionally executed by humans, from household chores to industrial machine operation. This same AI framework underpins Tesla's autonomous driving system, ensuring Optimus can interpret and interact with its environment dynamically. Already in operation within Tesla's factories, Optimus is continuously refining its capabilities through a data-driven learning process similar to Tesla's Full Self-Driving (FSD) software. This positions Tesla at the forefront of AI-driven automation, with applications that extend far beyond the automotive sector. Industry forecasts further reinforce the long-term potential. Morgan Stanley projects a humanoid robot population of 40,000 by 2030, expanding to 63 million by 2050, while Citigroup anticipates exponential growth, with over 1 billion robots in use by 2035 and as many as 4 billion by 2050. Given Tesla's early-mover advantage, the company is well-positioned to capitalize on this rapidly expanding market. Supporting this optimistic outlook, Bank of America analyst John Murphy sees Optimus benefiting from Tesla's broader advancements in autonomous technology. He expects the maturation of Tesla's robotaxi initiatives to accelerate Optimus's capabilities, facilitating increased production beyond 2026 and ultimately reducing unit costs, further strengthening Tesla's competitive edge in AI-powered robotics. Analyst Opinions on TSLA Stock Taking all of this into account, analysts have deemed Tesla stock a 'Hold' with a mean target price of $343.67. This denotes upside potential of about 46% from current levels. Out of 40 analysts covering the stock, 15 have a 'Strong Buy' rating, three have a 'Moderate Buy' rating, 12 have a 'Hold' rating, and 10 have a 'Strong Sell' rating.
