‘Scorching hot AI boom’ Investors have increasingly focused on Musk’s push into self-driving technology and robotics, with many looking for proof that the autonomy story is moving from promise to product. An investment by Tesla in xAI was long expected. Analysts have said Tesla will benefit from xAI’s advanced models and growing valuation. “With Tesla’s legacy EV business slowing, Tesla investors can take part in the scorching hot AI boom,” said Andrew Rocco, a stock strategist at Zacks Investment Research. Investors have also been looking for signs that Tesla’s Full Self-Driving (FSD) and robotaxi rollouts are advancing, including updates on regulatory progress and clearer timelines for the purpose-built Cybercab, which is designed without a steering wheel or pedals. An investment by Tesla in xAI was long expected. Analysts have said Tesla will benefit from xAI’s advanced models and growing valuation. REUTERS Cybercabs will be added to its robotaxi service that currently relies on Model Y vehicles running a version of Full Self-Driving and will also be available for consumers to buy. Last week, Musk said initial production of the Cybercab robotaxi and the humanoid robot Optimus would be “agonizingly slow” before accelerating over time, leaving investors waiting for a more detailed timeline and production forecast. There are also regulatory hurdles involved with producing the Cybercab, which Musk has said will have no steering wheel or pedals. Current federal rules allow companies to produce only 2,500 vehicles annually that deviate from federal vehicle design standards requiring such features. Last year, the US Transportation Department said it would be “streamlining” the exemption process, but 2,500 is still the cap. Tesla’s revenue fell about 3% to roughly $94.83 billion in 2025, marking the company’s first annual decline in revenue. Christopher Sadowski