Tesla has started production of its Optimus humanoid robot at its factory in Fremont, California, in a manufacturing space once dedicated to making electric vehicles, the company announced Wednesday.<\/p>\n
\u201cThe bots coming off this line are the first production-quality bots that we have manufactured,\u201d Tesla wrote in its third-quarter letter<\/a> to shareholders. \u201cWhile we will continue to iterate on the hardware and manufacturing process, we have proven that the current manufacturing process for Optimus is suitable for a commercial product.\u201d<\/p>\n Tesla CEO Elon Musk said on a conference call that he considers this \u201cearly production,\u201d and that the ramp will be an slow and \u201csomewhat bumpy because it is such a radically new product.\u201d He nonetheless claimed Tesla will be able to make 20,000 of them per week by the end of 2027.<\/p>\n \u201cThere\u2019s still some things we need to tweak about the design, because you need to deliver a robot that is that is safe and reliable and has long duration, so it can\u2019t like, wear out after a month,\u201d he said. \u201cAnd there\u2019s still quite a lot of work to do with regard to the AI and the robot for it to be truly useful for open-ended tasks.\u201d<\/p>\n That fordward-looking development wasn\u2019t enough to lift the company\u2019s otherwise middling third-quarter earnings, results that typify a company at the midpoint of a major bet. Tesla\u2019s revenue was flat and its expenses skyrocketed as it pressed the accelerator on its Optimus robots, AI, and autonomous driving.\u00a0The end result was a 43% drop in profits. <\/p>\n The company\u2019s revenue was largely driven by EV sales, which were flat year-over-year at $20 billion. Tesla delivered 486,532 vehicles<\/a> in the third quarter, about 6,000 more than the previous quarter, but fewer<\/a> than in the same period last year.\u00a0<\/p>\n Tesla\u2019s total third-quarter revenue was $28.04 billion, a skosh below the $28.09 billion it generated in the third quarter of 2025. Tesla\u2019s third-quarter revenue was also about $200 million lower than the previous quarter\u2019s haul of $28.23 billion.<\/p>\n Tesla saw a 16% year-over-year drop in its solar and energy storage business to $2.8 billion, which it blamed on tariff-related customer refunds. There was some positive revenue growth in its services business, a category that includes customer subscriptions to its Full Self-Driving advanced driver-assistance software. Tesla\u2019s services business grew 33% year-over-year, bringing in $4.6 billion.\u00a0<\/p>\n None of this was enough to outpace Tesla\u2019s spending on artificial intelligence projects and its Optimus robot, which took a big bite out of profits.<\/p>\n The company reported $787 million in net income, a 43% drop from the same period in 2025 when it earned $1.37 billion. Lower regulatory credit sales also put pressure on its profitability. The company stayed in the black in large part because of a big boost from its \u201cservices and other\u201d segment, which accounted for a record $734 million in gross profit for the quarter.<\/p>\n This story has been updated with information from Tesla\u2019s quarterly conference call.<\/p>\n