Tesla's upcoming first-quarter earnings report on April 22 is poised to be a pivotal moment for investors, with a primary focus on the company's future capital expenditure plans, particularly for its ambitious "Physical AI" projects. According to analysis from Barclays, a key question for the earnings call will be the incremental capex required for Terafab, Tesla's plan to build a 1 terawatt AI compute factory. This project, alongside a separate plan for 100 GW of solar capacity, was notably not included in Tesla's $20B+ 2026 capex guidance provided previously.
Barclays analyst Dan Levy flagged Terafab as a potential multi-trillion-dollar endeavor if fully built out, describing the combined AI and solar plans as a "symbolic baton pass for Tesla from automotive to Physical AI." The firm expects future growth to be driven increasingly by Robotaxi scaling, Full Self-Driving (FSD) development, and Optimus production, rather than traditional vehicle sales. However, near-term margins are expected to decline quarter-on-quarter in Q1 due to lower delivery volumes and raw material costs.
Separately, Tesla CEO Elon Musk announced a significant technological milestone, confirming that the design phase for Tesla's AI5 chip has been completed with a "tape-out." The AI5 chip, built to power Tesla's next-generation self-driving systems, is slated for high-volume production in 2027, replacing the current AI4 hardware. Musk also teased that work on the AI6 chip is already underway, with a potential tape-out as early as December 2026, and development of Dojo 3, the next iteration of Tesla's in-house AI training supercomputer.
The announcement, which thanked manufacturing partners Samsung Electronics and Taiwan Semiconductor Manufacturing (TSMC), contributed to a 0.66% premarket stock increase to $366.60. Analysts remain divided on Tesla's stock, with a consensus "Hold" rating and an average price target of $402.29, implying roughly 10.46% upside.
