Tesla CEO Elon Musk plans to shift his focus from electric vehicles to humanoid robots. The move comes amid stagnating electric vehicle sales.
Bloomberg reported Musk made a bold statement on X at the beginning of September, declaring "80% of Tesla's value will be Optimus."
While Musk has been clear about his plans to invest in artificial intelligence, it is hard to ignore this is occurring amid automotive business challenges.
Demand for Teslas was sluggish between 2023 and 2024, as Bloomberg noted. Despite this, its stock retained its value at "around 155 times its earnings over the next 12 months."
The valuation is higher than those of other tech giants that are part of the Magnificent Seven, including Google parent company Alphabet, Amazon, and Apple, according to the report. It seems investors are betting on Musk.
Tesla shares are "down over 10% this year, putting the company among the 100 worst performers in the S&P 500 Index, which is up 12% for 2025," per Bloomberg.
However, Dmitry Shlyapnikov, an analyst at Horizon Investments, noted Tesla's potential, per Bloomberg: "Tesla is priced like a growth company but has seen little meaningful growth in the past two years. Elon Musk needs to provide a different growth story for investors. And Optimus is the answer."
"Tesla has never been valued strictly as a car company and instead as a bet on Musk's ability to bring a sci-fi future to life," said Steve Sosnick, chief strategist at Interactive Brokers, who pointed to the company's robotaxi endeavors as not being enough to move the needle.
While Tesla has made it clear AI is a major part of its plan, that doesn't mean it will eliminate its EVs, perhaps alleviating fears that its efforts to reinvent itself will make its EVs harder to come by or influence a delay in adopting cleaner transportation options.
EVs offer environmental benefits because they produce zero tailpipe pollution and don't burn expensive dirty fuels. This means they help create healthier communities and combat rising global temperatures. They also save drivers money because they require less maintenance.
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