Elon Musk has identified the creation of the AI5 chip as one of Tesla's key projects for the future. He emphasized his involvement in the development, dedicating every Saturday and Tuesday to it. According to him, the new chip will provide a 50-fold increase in performance compared to previous versions. In particular, computing power will increase tenfold, memory capacity ninefold, and operational efficiency fivefold. This is critically important for the operation of both autonomous vehicles and robots.
The launch of AI5 is scheduled for 2027, and its successor, AI6, may hit the market as early as 2028 if the development schedule is adhered to. Musk also noted that Tesla does not plan to sell its chips to other companies — they are intended exclusively for internal use.
“We need these chips for ourselves,” he added, emphasizing the company's confidence in the architecture of the developed solution.
Musk also pointed out that the main limitation on Tesla's growth in the coming years will not be car production, but access to microchips. Specialized AI processors are necessary for creating autonomous robotaxis and Optimus robots, and without them, scaling the business is impossible. Currently, Tesla has guaranteed supplies for three years ahead; however, the situation beyond that remains uncertain.
In this context, Musk once again raised the issue of creating its own semiconductor plant, TeraFab, which will focus on the production of logic chips, memory, and packaging. He warned that without in-house production, Tesla could face risks related to disruptions in global supply chains, especially in light of geopolitical tensions surrounding Taiwan.
However, CFO Vaibhav Taneja clarified that TeraFab is not currently included in the company's investment plans.
Tesla continues to invest in its AI infrastructure. In the first half of 2026, the company plans to more than double its computing power for AI training at its Texas facility, equivalent to the power of Nvidia's H100 GPU. To this end, a new supercomputer, Cortex 2, is being built at Gigafactory. Additionally, Tesla announced a $2 billion investment in the startup xAI, which is owned by Musk.
A separate part of the conference was dedicated to robotics and global competition. Musk stated that China's humanoid robots are Tesla's most serious competitors. He noted that this country combines strong developments in AI with an outstanding ability to scale production, as has already been observed in the electric vehicle market.
Nevertheless, Musk is confident that the Optimus robot will surpass its Chinese counterparts in terms of "real intelligence" and mechanical dexterity, especially in the design of the hand — the most complex part of the robot.
At the same conference, Musk announced that Tesla would cease production of the Model S and Model X in the next quarter. The freed-up production capacity at the Fremont factory will be reconfigured for assembling humanoid robots, Optimus. For the fourth quarter, Tesla reported revenue of $24.9 billion and adjusted earnings per share of $0.50, exceeding some analysts' expectations despite a decline in revenue compared to the previous year.
