Tesla has started producing its Optimus humanoid robot at its Fremont factory in California, marking the beginning of commercial-scale manufacturing for the project. The announcement came alongside Tesla’s third-quarter 2026 earnings, which showed a 43% decline in net income as the company increased spending on artificial intelligence, robotics, and autonomous driving.
According to its October 21 shareholder update, the factory has produced its first production-quality Optimus robots using manufacturing space previously dedicated to electric vehicles. Tesla said the existing production process is suitable for a commercial product, although further improvements to the robot’s hardware and manufacturing methods remain necessary.
Tesla Targets 20,000 Optimus Robots Per Week by 2027
CEO Elon Musk described the current manufacturing stage as early production and warned that output would increase gradually due to the complexity of the robot. He expects Tesla to reach approximately 20,000 Optimus units per week by the end of 2027, although the company has not disclosed its current production volume.
Musk said engineers are still refining the robot’s mechanical design, durability, and AI capabilities to ensure it can operate reliably for extended periods. The company must also improve its ability to perform varied tasks without requiring specific programming for each activity.
Tesla has installed much of the equipment required for a high-volume production line in Fremont and is constructing additional Optimus manufacturing facilities in Texas. However, Musk acknowledged that hardware changes, component availability, and supply chain development could affect production timelines.
Tesla Reports 43% Decline in Quarterly Profit
Tesla generated $28.04 billion in third-quarter revenue, nearly unchanged from $28.09 billion a year earlier and slightly below the previous quarter’s $28.23 billion. Net income declined to $787 million from $1.37 billion in the same period of 2025.
Automotive revenue reached approximately $20 billion as Tesla delivered 486,532 vehicles during the quarter, fewer than a year earlier. Revenue from energy generation and storage fell 16% to $2.8 billion, partly due to tariff-related customer refunds.
The company’s services business grew 33% year over year to $4.6 billion, generating a record $734 million in gross profit. This segment includes revenue from subscriptions to Tesla’s Full Self-Driving (FSD) driver-assistance software.
Tesla also faced lower regulatory credit revenue and higher operating expenses related to its AI and robotics investments. These costs contributed to the decline in quarterly profitability despite relatively stable overall revenue.
Tesla Delays Unsupervised Driving for Customer Vehicles
Tesla executives also provided an updated timeline for introducing unsupervised driving capabilities to privately owned vehicles. Ashok Elluswamy, Tesla’s vice president of AI software, said some customer vehicles could begin joining its robotaxi network around the second quarter of 2027.
The proposed system would allow eligible vehicles to operate without continuous driver supervision under supported conditions. Tesla’s existing FSD (Supervised) software still requires drivers to monitor the road and remain ready to intervene.
The revised timeline follows Musk’s earlier prediction that unsupervised driving could become available to consumers during the fourth quarter of 2026.
Featured image credits: Wikimedia Commons
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