Elon Musk asserts that Optimus robots could propel Tesla to become a $25 trillion enterprise, surpassing half the worth of the S&P 500 at present.

• Elon Musk, CEO of Tesla, stated at the 2024 annual shareholder meeting that humanoid robots could potentially increase the company's market cap to $25 trillion at an undisclosed future date.
• Tesla's market cap was approximately $580 billion as of Thursday's close.
• According to FactSet, the total value of the S&P 500 is currently $45.5 trillion.

FactSet reports that the current value of the S&P 500 is $45.5 trillion. On Thursday, CEO Elon Musk stated that his company's Optimus humanoid robots could potentially increase the automaker's worth to more than half of that amount.

At the 2024 annual shareholder meeting in Austin, Texas, Musk, who is known for his "pathologically optimistic" outlook, announced that Tesla is entering a new phase in its existence, which he referred to as a "new book." One of the key players in this new chapter is Optimus.

In 2021, Tesla unveiled its plans to develop humanoid robots at an AI Day event, showcasing a dancer in a unitard that resembled a sleek, androgynous robot.

In January, Tesla unveiled Optimus robots performing laundry folding in a video that was met with criticism from robotics experts for being misleading. The robots were not self-operating but were instead being controlled by humans.

At the shareholder event on Thursday, Musk did not reveal the full capabilities of Optimus. He stated that the robots would eventually be able to perform tasks like R2-D2 and C-3PO in Star Wars, such as cooking, cleaning, factory work, or teaching children.

Tesla's market cap could reach $25 trillion with Optimus as the driving force, according to Musk.

In an auditorium at the Gigafactory, Musk announced that Tesla would commence "limited production" of Optimus in 2025 and conduct humanoid robot testing in its own factories in the upcoming year.

In 2025, Tesla will have "more than 1,000 or a few thousand" Optimus robots working for the company.

Even for Musk, who is known for making ambitious promises to investors and customers that don't come true, this is all far-out stuff - from developing software that can turn an existing Tesla into a self-driving vehicle with an upload, to EV battery swapping stations.

Tesla would be worth about eight times its current value if it reached a $25 trillion market cap, making it the world's biggest company by market cap, just ahead of Apple.

On Thursday, Tesla was worth approximately $580 billion, placing it as the 10th most valuable company in the S&P 500 at close.

Musk stated that autonomous vehicles could help Tesla achieve a market cap of between $5 trillion and $7 trillion, but he did not specify a timeline for reaching $25 trillion.

Tesla bull Cathie Wood, CEO of ARK Invest, has a $2,600 price target on Tesla's stock by 2029, and Musk agrees with her numbers.

Tesla's market cap should be over $8 trillion, according to Wood's price target.

The shareholder vote to reinstate Musk's $56 billion pay plan was followed by his comments at the annual meeting, five months after a Delaware court ordered the company to rescind the package. The crowd cheered when the proposal was read aloud and when preliminary results were announced.

Musk, after the shareholder votes were read out, exclaimed, "Hot d---! I love you guys."

Tesla's stock price has decreased by 27% this year due to a decline in sales, which is partly attributed to an outdated range of electric vehicles and intensified competition in China. Additionally, the company has recently announced significant job cuts. Despite this, Musk is urging investors to focus on the company's future prospects, including self-driving cars, robots, and artificial intelligence.

On Thursday, Musk declared that Tesla has surpassed the industry in inference, a process used by machine learning models to draw conclusions from new data.

Nvidia's AI chips have propelled the company's stock price to a nine-fold increase since the end of 2022, resulting in a valuation of approximately $3.2 trillion.

One concern about Musk is that he is heavily focused on Tesla despite his other commitments. He owns and runs X, is CEO of SpaceX, founded The Boring Co. and Neuralink, and launched xAI last March, which recently raised $6 billion in venture funding.

At the meeting, a shareholder inquired about Musk's personal significance to Tesla's future.

He emphasized his role in innovation by stating, "I am a helpful accelerant to that future."

Boston Dynamics, Agility, Neura, and Apptronik are among the competitors in the market for humanoid robots, according to him.

"What truly matters is whether we can outpace everyone else and complete our product several years ahead of theirs while maintaining superior quality," Musk stated.

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