Tesla Completes Key AI Chip Milestone in Its Push Beyond the Auto Industry

Tesla completed the tape-out for its AI5 chip, which will power its Optimus humanoid robot and Cybercab self-driving vehicle. The chip offers 40x performance improvement over the previous generation and will be manufactured by Samsung and Taiwan Semiconductor over the next 12-18 months. Tesla plans to build its own semiconductor facility (Terrafab) in Texas with SpaceX and Intel to achieve vertical integration and cost advantages. However, the analyst cautions that Tesla's $1.4 trillion market cap already prices in this ambitious vision, which remains years away from reality.