Tesla Begins Optimus Robot Production in California as Quarterly Profit Falls 43%

Tesla has begun building its Optimus humanoid robot at its Fremont, California factory, in a space that once housed electric vehicle manufacturing, the company announced Wednesday.

In its third-quarter shareholder letter, Tesla said the machines coming off the line are "the first production-quality bots that we have manufactured," adding that while hardware and manufacturing will keep evolving, the current process is suitable for a commercial product.

CEO Elon Musk called it "early production" on a conference call, warning the ramp will be slow and "somewhat bumpy because it is such a radically new product." He said Tesla aims to make 20,000 per week by the end of 2027, though he acknowledged design tweaks remain for safety and reliability, and that the robot's AI needs substantial work before it is truly useful for open-ended tasks.

The forward-looking news didn't offset a middling quarter. Revenue was essentially flat at $28.04 billion, just below the $28.09 billion of a year earlier, while spending on Optimus, AI and autonomous driving climbed. Net income came in at $787 million, a 43% drop from $1.37 billion in the same period of 2025, with lower regulatory credit sales also weighing on profitability.

EV revenue held at $20 billion, with 486,532 vehicles delivered - about 6,000 more than the prior quarter but fewer than a year earlier. Solar and energy storage fell 16% to $2.8 billion, which Tesla blamed on tariff-related customer refunds, while services grew 33% to $4.6 billion.