Optimus remains 'very complex' and Robotaxis will try not to flatten your cat:
Tesla's investment bill ballooned in calendar Q2 as Elon Musk's biz entered what it calls its "largest and most exciting period of investment.
The company has poured resources into AI silicon and robotics, with capex [PDF] more than doubling from $2.5 billion in the previous quarter to $5.8 billion.
That left Tesla with negative free cash flow of $1.1 billion, down 848 percent year-on-year. It expects spending to keep rising and exceed $25 billion for the year.
During the earnings call, Musk talked up Tesla's Terafab ambitions but gave little detail other than calling it an "amazing initiative" and confirming that equipment orders had been placed for the development fab in Austin.
"It's intended to have lithography mask production, and then logic, memory and packaging, and chip testing all under one roof," he said. "So you can have a very fast iterative cycle." Musk acknowledged it was a "high-risk, high-payoff bet on AI chips."
Musk said Terafab was essential to scaling Optimus because Tesla would otherwise be unable to secure enough AI chips, hence the prodigious expenditure.
As for Tesla's automaker business, vehicle deliveries were up 25 percent year-on-year in Q2 to 480,126, and total automotive revenues surpassed $20 billion. However, operating margin fell to 1.4 percent from 4.1 percent a year ago.
According to Tesla, it is "in its largest and most exciting period of investment" as it builds out the infrastructure needed to make good on Musk's many promises.
"I think Optimus [Tesla's humanoid robot] will be the biggest product," Musk reiterated during the earnings call, before cautioning that "it is a very complex problem to solve."
Tesla is also facing stiff competition from China, which is also talking up its humanoid robots. Musk claimed Optimus will be the first "able to do generalized tasks."
Then there is the Robotaxi project, where the billionaire noted intense scrutiny from regulators "We're going as fast as humanly possible in scaling Robotaxi... while trying to ensure that we do not harm anyone at all and ideally do not even run over a pet," he said.
In answer to a question regarding combining Tesla and another of Musk's companies, SpaceX, he acknowledged overlap between the two but said it wasn't possible to talk about a combination on the Tesla results call.
He left it to Brandon Ehrhart, Tesla's general counsel, to say: "We continue to benefit from our relationship with SpaceX... They've been a great partner, and we have numerous beneficial transactions with them."
Investors were not impressed. Shares in the company fell in after-hours trading, while another of Musk's companies, SpaceX, continued its downward trajectory, standing at just over $115 by yesterday's close, well below its $135 IPO price and a huge drop from its $225 high.
(Score: 3, Interesting) by Username on Monday August 03, @04:46PM (1 child)
He never takes risks without having a bailout plan, that being the fed ban on foreign robots and grants to his company. I think "AI" is a fake bubble, but I'm sure his version will be one of the few to make it.
(Score: 2) by arslan on Wednesday August 05, @01:06AM
Its high risk, but they are genuine risks with a clear payout. He's trying to minimize external supply chain dependencies, particularly China, potentially keep any IPs well protected and retain the competitive edge - which seems to be futile thing if you have a critical part of your supply chain in China given it is a hybrid market where the CCP gets dibs on everything and re-distribute as they see fit.
Can't speak for the US, but where I'm at, robots are sorely needed for quite a few industry that we have today.
(Score: 4, Interesting) by VLM on Monday August 03, @05:17PM (4 children)
At the low end, we already have far too many people for far too little work. We already have an infinite supply of people willing to gig economy for essentially $0. The financing cost of hiring a desperate poor person willing to work for roughly $0 is always going to be higher than the cost of financing and operating a robot. Remember Walmart knowingly doesn't pay enough for its employees to live, it relies on taxpayers to pay for its employees medical care and food stamps, that'll never compete with a hyperexpensive robot.
At the high end its mostly high paying due to the intersection of personal responsibility and risk and reputation. People go to that surgeon because its his personal reputation and malpractice insurance bill on the line so he'll get it correct, probably. The crew chief who replaced the engine on your jetliner spent 20 years building his career to sign off on the work. "AI" type products only work for zero responsibility stuff because its not very good and when it fails people seem to accept no one will take responsibility for the failure.
In the middle the problem is usually a balance of inability to manage vs the managed peoples ability to rise above that by personal initiative to get things done. That's a big ask for zero responsibility AI.
Would you let a humanoid robot replace the brakes on your car? Remember the financing costs of the robot will make it more expensive than using human labor, and when they make a mistake, much like AI, no one will take any responsibility.
I don't see this working very well due to the lack of a market. Possibly he's going for some kind of "star wars the clone wars" military use for clankers. Overwhelming force via mass production to commit genocides and stuff. Maybe.
(Score: 2, Interesting) by VLM on Monday August 03, @05:21PM
Proposal: I just came up with this idea a second after I hit "submit". I may be looking at this too long term and too superficially.
It's not a "AI chip plant" its just a fab somewhat optimized for larger dies. As a medium term idea, after China invades Taiwan simply change the fab line masks to anything you want.
It's also a bargaining chip (get the pun?) both for Tesla and at a national security level. Go ahead, if you're feeling lucky, threaten our globalist supply chain, find out just how much we need it...
(Score: 5, Interesting) by turgid on Monday August 03, @05:48PM
At the low end, we already have far too many people for far too little work. We already have an infinite supply of people willing to gig economy for essentially $0.
Yes, we humans are now effectively obsolete and redundant in terms of the traditional economy. Personally, i just need to keep going long enough to secure the roof over my head and that's me. I have just about enough land to subsist on potatoes and I know how to catch fish.
Another economy will spring up separate from the original. It will involve barter at first. What was the traditional economy will become circular. The snake will eat its tail. That's similar to what's already happening with the Internet being a bunch of AI bots producing and consuming slop from each other.
Will traditional money retain any value? Or will it only be of value to other billionaires who will trade in the output of their captive machines?
I refuse to engage in a battle of wits with an unarmed opponent [wikipedia.org].
(Score: 3, Interesting) by arslan on Wednesday August 05, @01:20AM (1 child)
Maybe in the US. Where I'm at, we have quite a few industries sorely lacking labour. You've picked on examples that maybe are not suited for robotics but there's definitely examples that do. Generalizing to say robots won't work because here's some examples that makes no sense is a bit far fetched.
And yes, there will be teething issues and exceptions where things go wrong, it is an iterative process like any new tech.
Just to give you some examples of industries in my neck of the woods that have big labour shortages: construction, care (aged, child, patient, etc.), community/volunteering services.
And yes for the first two, we already have people dying due to compensating with underqualified imported workers (construction) or lack of (care industry). Not to mentioned all the poor quality of life as a consequence of this.
If the US have too many people and truly not enough jobs at the aggregate level - the true solution isn't "let's not introduce this tech because less jobs", you should rather be solving the problem at its source. If you have at aggregate enough, and its people being choosy about work, it is also another problem you should be solving differently.
(Score: 2) by VLM on Thursday August 06, @01:07PM
In the USA reports of this are universally false, either HR refuses to hire for political reasons (racial hatred, etc) or its an outright "big lie" to try and depress wages.
Its pretty rare for a production line, for example, to shut down. Happens once in awhile at microbusinesses where all three waitresses quit the same day, but not at real companies. No there seems no lack of labor LOL.