Tesla has commenced early production of its Optimus humanoid robot at its Fremont, California factory, aiming to scale up output and begin customer deliveries by late 2027. The heavy investment in physical AI and robotics contributed to a 43% drop in Tesla's third-quarter 2026 net income to $787 million despite flat revenue of $28.04 billion. Meanwhile, Tesla pushed its unsupervised Full Self-Driving robotaxi rollout to Q2 2027 amid mounting competition in the humanoid market.
Fremont Optimus production launch
- ▪Tesla began producing its Optimus humanoid robot at its factory in Fremont, California, in manufacturing space previously used for electric vehicle assembly, according to Tesla's October 21, 2026 shareholder letter
- ▪Tesla repurposed factory space at its Fremont, California plant by ending Model S and Model X vehicle production earlier in 2026 to build an Optimus line capable of producing one million robots annually
- ▪Tesla announced in its October 21, 2026 earnings report that the Optimus humanoid robots built on its Fremont line represent the company's first production-quality models
Optimus delivery and production targets
- ▪Tesla Chief Executive Officer Elon Musk stated during the October 21, 2026 earnings call that initial Optimus robot deliveries to customers are targeted for the end of 2027
- ▪Tesla aims to scale production of its Optimus humanoid robot at its Fremont facility to 20,000 units per week by the end of 2027, according to Chief Executive Officer Elon Musk
Optimus manufacturing and scaling
- ▪Tesla is constructing a second Optimus production line in Austin, Texas, in addition to its Fremont, California line, with a planned annual production capacity of 10 million humanoid robots
- ▪Tesla Chief Executive Officer Elon Musk stated on October 21, 2026, that building robot hands represents one of the primary challenges in manufacturing the Optimus humanoid robot
Tesla third-quarter 2026 financial results
- ▪Tesla reported third-quarter 2026 net income of $787 million, representing a 43% decline from $1.37 billion in the third quarter of 2025 due to increased spending on artificial intelligence and Optimus development
- ▪Tesla saw its third-quarter 2026 solar and energy storage revenue drop 16% year-over-year to $2.8 billion due to tariff-related customer refunds, while services revenue grew 33% to $4.6 billion
- ▪Tesla generated $28.04 billion in total third-quarter 2026 revenue, driven primarily by $20 billion in electric vehicle sales from delivering 486,532 vehicles
Full Self-Driving release timelines
- ▪Tesla Vice President of AI Software Ashok Elluswamy stated during the October 21, 2026 earnings call that unsupervised Full Self-Driving software for customer vehicle robotaxi fleets is targeted for around the second quarter of 2027
- ▪Tesla Chief Executive Officer Elon Musk had previously stated during an April 2026 earnings call that unsupervised Full Self-Driving capabilities would probably be released in the fourth quarter of 2026
Competitor humanoid robot deployments
- ▪Robotics companies Sunday Robotics, 1X, and Weave Robotics are preparing to ship humanoid robots designed for home environments in the fall of 2026
- ▪Humanoid robotics competitor Agility Robotics has deployed its Digit robot across nine customer facilities, while Figure AI announced deployments in logistics and distribution centers in 2026
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