Tesla Starts Optimus Robot Production as Quarterly Profit Declines
Optimus enters production at Fremont
Tesla has started producing its Optimus humanoid robot at its Fremont, California factory, using manufacturing space that had previously been dedicated to electric vehicles. In its third-quarter letter to shareholders, the company said the units leaving the line are the first “production-quality” Optimus robots it has manufactured.
Tesla said it will continue to iterate on both the robot hardware and the manufacturing process. However, it said the current Optimus production process has been demonstrated as suitable for a commercial product. The announcement provides a concrete manufacturing milestone for a programme that Tesla is developing alongside artificial intelligence and autonomous-driving work.
Investment coincides with a 43% profit decline
The production news arrived with a weaker quarterly profit result. Tesla reported net income of $787 million for the third quarter, down 43% from $1.37 billion in the same period of 2025. The company said spending on AI projects and Optimus weighed on profits, while lower regulatory-credit sales also pressured profitability.
Total third-quarter revenue was $28.04 billion, slightly below the $28.09 billion reported in the third quarter of 2025 and below the prior quarter’s $28.23 billion. Electric-vehicle sales remained Tesla’s largest revenue contributor, but were flat year on year at $20 billion.
Tesla delivered 486,532 vehicles during the quarter. That was roughly 6,000 more than in the previous quarter, but below the volume delivered in the same period a year earlier. Its solar and energy-storage business recorded a 16% year-on-year revenue fall to $2.8 billion, which Tesla attributed to tariff-related customer refunds.
Services offset part of the pressure
Growth in services and other revenue offered an offset. The category, which includes customer subscriptions to Tesla’s Full Self-Driving advanced driver-assistance software, grew 33% year on year to $4.6 billion. It generated a record $734 million in gross profit for the quarter and helped keep the company profitable.
Tesla’s expanding commitments are also reflected in Tesla credit lines for Cybercab and Optimus development for Cybercab and Optimus development, linking the robot production milestone to a wider set of capital-intensive initiatives. The current results show that the company is pursuing those programmes while its core EV revenue remains flat.
Business implication
For businesses assessing industrial robotics or AI-led automation, Tesla’s quarter illustrates the distinction between establishing a production-capable process and generating near-term financial returns. Manufacturing validation is an important step, but investment decisions should also account for continuing iteration, operating costs and the performance of the established business that funds the programme.