Tesla, Inc.

Good afternoon, everyone, and welcome to Tesla's fourth quarter 2025 Q&A webcast. My name is Travis Axrod, Head of Investor Relations, and I'm joined today by Elon Musk, Vibhav Dinesh, and a number of other executives. Our Q4 results were announced at about 3 p.m. Central Time in the update deck we published at the same link as this webcast. During this call, we will discuss our business outlook and make forward-looking statements. These comments are based on our predictions and expectations as of today. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in our most recent filings for the SEC. During the question and answer portion of today's call, please limit yourself to one question and one follow-up. Please use the raise hand button to join the question queue. Before we jump into Q&A, Elon has some opening remarks. Elon?

Thanks, Travis. We've updated the Tesla mission to amazing abundance, and this is intended to send a message of optimism about the future. I think we're most likely headed to an exciting, amazing era of abundance. And I think with the advent or with the continued growth of AI and robotics, I think we actually are headed to a future of universal high income, not universal basic income, but universal high income. I mean, there's going to be a lot of change along the way, but that is what I see as the most likely outcome. So I think that makes sense to update Tesla's mission to reflect that goal. And obviously along that way we're going to keep improving safety, driving down the cost of goods, and getting people access to anything they need without compromise. And so making sure that the environment is great, nature is great, and people can have whatever they want, which seems like probably the best future. I'm open to other ideas, but that sounds like, it sounds like if you could say what is the best future you could possibly imagine, I guess it would be that everyone can have whatever they want, including amazing medical care, but we still keep the beauty of nature and Earth. I think that's probably the best outcome. And we're seeing, obviously, the first steps along that way this year for Tesla, first major steps, as we increase vehicle autonomy and begin to produce Optimus robots at scale. We're making very, very big investments. This is going to be a very big CapEx year, as Bible will get into. That is deliberate because we're making big investments for an epic future. So I think all these investments make a lot of sense. We'll continue to make sure that. When we do spend capital, it is spent very efficiently. But it's a lot of things. You know, major investments in batteries and the entire supply chain of batteries. So we're also going to be significant manufacturers of solar cells, and we're making massive investments in AI chips. So, but I think these will make a ton of strategic sense. And then I guess I have like one, I guess, it's not exactly bad news, but it's a... it's time to basically bring the Model S and X programs to an end with an honorable discharge because we're really moving into a future that is based on autonomy. And so if you're interested in buying a Model S and X, now would be the time to order it. because we expect to wind down S and X production next quarter and basically stop production of Model S and X next quarter. We'll obviously continue to support the Model S and X programs for as long as people have the vehicles. But we're going to take the Model S and X production space in our Fremont factory and convert that into an Optimus factory with the long-term goal of having a million units a year of Optimus robots in the current SX space in Fremont. So that is slightly sad, but it's But it is time to bring the SX programs to an end and shift really – it's part of our overall shift to an autonomous future. As my profile picture on X said for a few months there, the future is autonomous. And so with respect to full self-driving and robo-taxi, people are obviously following with very close attention the progress of FSE. And you can experience it for yourself. If you've got a Tesla, you notice with every software update, the car gets better and better at autonomy. And we're, you know, We were able to do our first rides with no safety monitor in the car in Austin. These were paid rides, so these were just sort of randomly selected paid rides with no safety monitor. I mean, maybe as of yesterday or so, we don't even have a chase car or anything like that. So these are just cars with no people in them, and no one's following the car in Austin. So we obviously are being very cautious about this because we want to have— where we won't have no injuries or serious accidents along the way. So I think it makes sense to be very cautious, but you'll see the amount of autonomy increase dramatically, I think, every month essentially. And then there will also be an opportunity, something we've talked about for a long time, for existing owners of Teslas to add or subtract their cars to the fleet, kind of like how Airbnb works where you can – add or subtract your house to the Airbnb inventory. And I think probably the value of the Tesla, the sort of partial people adding or subtracting the cost to Tesla autonomous fleet is probably a little underweighted by a lot of people because we've got millions of cars with AI4 that can do this. So it might potentially, I think it will provide an opportunity for a lot of customers to earn more by lending their car to the fleet than their lease cost to Tesla. Yeah, which is kind of like you get, in that scenario, you basically get paid to own a Tesla. It's quite a good scenario. And we expect to have fully autonomous vehicles in probably, I don't know, somewhere between a quarter and half of the United States by the end of the year, pending regulatory approval. A big factor would be if there's some kind of federal preemption for autonomous vehicles. In the absence of that, you kind of have to go on a city-by-city or state-by-state basis. But nonetheless, even if it is city-by-city, state-by-state, we expect to be in... I don't know, dozens of cities, dozens of major cities by the end of the year. With respect to energy, the Tesla energy team has done incredible work, and the growth rate on that is continuing to be very strong, and we're building more manufacturing capacity and expect that energy will have very high growth for really as far into the future as we can imagine. The solar opportunity is underestimated. We think the best way to add significant capability to the grid is, or energy to the grid, let's say powering AI data centers, is solar and batteries on Earth and solar in space. So that's why we're going to work towards getting 100 gigawatts a year of solar cell production capacity. integrating across the entire supply chain from raw materials all the way to finished solar panels. Maybe a bit more about Optimus. We'll probably unveil Optimus 3 in a few months. And I think it's going to be quite interesting. It's just an incredibly capable robot. And as I mentioned, we are replacing the SX line in Fremont with a million-unit-per-year line of Optimus. Now, because it is a completely new supply chain, it's just – there's really nothing – from the existing supply chains that exist in Optimus. Everything is designed for physics first principles. So that means the normal S-curve of manufacturing ramp will be longer for Optimus than it is for products that have at least some portion of an existing supply chain. Like when everything's new, the production rate will be proportionate to the least lucky, least confident part of the entire supply chain. And if there's 10,000 things that need to go right, it only takes one to be slow to lag that. So it will be sort of a stretched out S-curve, but I'm confident that we'll get to a million units a year in Fremont of Optimus 3. And this Optimus really will be a general-purpose robot that can learn by observing human behavior. So you can, like, demonstrate a task or literally verbally describe a task or show it a task, even show it a video, and it will be able to do that task. So it's going to be a very capable robot. I think long-term Optimus will have a very significant impact impact on the U.S. GDP, like it will actually move the needle on U.S. GDP significantly. So in conclusion, There's still obviously many who doubt our ambitions for creating amazing abundance, but we're confident it can be done and that we're making the right moves technologically to ensure that it does. And Tesla's obviously never been a company to shy away from solving some of the hardest problems. I think that's kind of how you build value in a company is you solve hard problems. So you don't know how you create value by solving easy problems. So there's a lot of hard problems that the Tesla team is going to solve, but it's an incredibly talented, hardworking team. And I'd like to thank, actually, everyone at Tesla for their incredible hard work. And it's an honor to work with such a talented group. So thank you to everyone who is supporting this mission. The future is more exciting than you can imagine.

Fantastic. Thank you so much, Elon. And next we have some remarks from Vebav.