Top News

Tesla announces $20B investment push for Musk's AI-first future
29 Jan 2026

Tesla has announced a massive $20 billion capital expenditure plan for this year, more than double Wall Street's expectations.

The move is part of a major overhaul aimed at streamlining its electric vehicle (EV) range and shifting focus toward robotics and artificial intelligence (AI).

The investment will be used to expand production at several factories, ramp up the fledgling robotaxi business, and develop AI infrastructure.

Tesla to discontinue Model S and X
Product discontinuation

Along with its ambitious spending plans, Tesla also announced the discontinuation of its Model S and X vehicles.

The company will now use the capacity of these plants to manufacture Optimus humanoid robots.

"We're making very, very big investments," said CEO Elon Musk during a conference call after Tesla's fourth-quarter results were released.

Tesla's new AI agreement and semiconductor plans
Strategic moves

Tesla has also signed a deal to invest $2 billion in Musk's xAI start-up.

The companies have also signed a "framework agreement" to strengthen their relationship and enhance Tesla's ability to develop and deploy AI products.

There are also talks of potentially building a semiconductor manufacturing facility, further highlighting Tesla's commitment toward AI, autonomous driving technology, and robotics.

Investors support Tesla's shift toward AI and robotics
Investor response

Despite the uncertainty surrounding these new business lines, investors have largely supported Tesla's transformation.

Andrew Rocco, an analyst with Zacks Investment Research, said this quarter marks a fundamental shift from an EV company to one focused on robotaxi, energy, and Optimus.

"It looks like they're almost ready to tear off the Band-Aid on the EV business and go full in on autonomy," he added.

4th-quarter earnings beat analyst estimates
Financial performance

Tesla's adjusted earnings per share were 50 cents in the fourth quarter, five cents higher than analysts' average estimates.

The results ended a streak of four consecutive quarters where profits missed expectations.

However, this comes as Tesla grapples with declining EV demand and increasing competition.

Musk has previously warned that the company will face challenges while focusing on these new priority areas.

Tesla's robotaxi business expansion plans
Business growth

Tesla also announced plans to expand its budding robotaxi business into Dallas, Houston, Phoenix, Miami, Orlando, Tampa, and Las Vegas in H1 2026.

The company launched its autonomous rideshare service in Austin last June.

Earlier this month, it began deploying "a few" robotaxis without human driver supervision in Austin.

The vehicles had earlier been operating with human safety supervisors in the front seats.