Following Tesla Inc.‘s (NASDAQ:TSLA) Q3 earnings call on Wednesday, investors Gene Munster of Deepwater Asset Management and Dan Ives think that the company’s Full Self-Driving (FSD) technology remains a critical piece of the company’s business strategy.
TSLA Stock Falls as Investors Digest Lower CapEx Outlook
In a post on the social media platform X, Munster shared his ‘Pressure Points’ video where he described that Tesla stock was declining because Tesla had its “capex a little bit lower in the December quarter” and that because investors were focused on the “long-term opportunity, you want more capex.”
The investor then shifted focus to the FSD service, which he said was at an “inflection point” following Tesla’s latest figures from its earnings report. He said that Tesla added about 250,000 FSD subscriptions in Q3 and that the number of FSD miles driven was up 190% YoY.
Munster said that Tesla offering customers the opportunity to add their cars to the Robotaxi fleet sometime in 2027 Q2 was a “big step forward” for the company.
Gene Munster Hails Ashok Elluswamy
The investor pointed to Tesla AI Lead Ashok Elluswamy‘s response when an analyst asked if the company would be affected by traditional automakers partnering with companies like Nvidia Corp. (NASDAQ:NVDA) to develop Level 2+ self-driving systems.
“It’s easy to get to the first 90% and make a cool-looking demo,” Elluswamy said, but added that the final ten percent was “difficult” and “long-tailed” to get to self-driving without any injuries or accidents. “People don’t realize anyone with their sane mind should not attempt to solve this problem,” he said.
Elluswamy then said that as Tesla releases unsupervised FSD to its customer fleet, he did not think that Tesla’s rivals could “match it in several years.” Munster hailed Elluswamy’s response, saying that the FSD service would “blow you away,” urging people to try it.
Munster also pointed to Musk’s comments during the earnings call, where he said that customers coming into Tesla showrooms were asking for FSD demos and not a particular product like the Cybertruck or the Model Y.
The investor said that considering the FSD system’s progress, its “incremental value” to drive sales, as well as the potential around Robotaxis, the “momentum” around Tesla was picking up.
“So, big picture, FSD is working. It’s working for Tesla. It’s going to be really hard for traditional automotive to close that gap,” the investor said in the video.
Dan Ives Doubles Down on Tesla-SpaceX Merger
In a post on X, Ives also shared his views following the earnings call. “Tesla FSD continues to drive sales, with attach rates topping 75% of North American deliveries,” Ives said, while also adding that Tesla’s active FSD subscriptions reached 1.74 million, which was up 67% YoY.
“Optimus production has begun as the AI era now takes shape at Tesla which dovetails into SpaceX merger strategic fit,” he added in the post, backing a merger between Tesla and Space Exploration Technologies Corp. (NASDAQ:SPCX) yet again.
Musk, during Tesla’s earnings call, said that producing 20,000 units a week of the Robot at the company’s Fremont, California, facility could take a year or maybe longer. Musk earlier this month said Optimus and Robotaxi could eventually account for the majority of Tesla’s value.
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