Elon Musk frets over controlling Tesla's ‘robot army' as car biz rebounds slightly

Core Insights - Tesla achieved record vehicle deliveries in Q3 2025, but profits were still 37% lower than the same quarter last year, indicating challenges in profitability despite high sales volume [2][3] - CEO Elon Musk is focused on developing AI and self-driving technology, which he believes is essential for unlocking the full value of a proposed $1 trillion compensation package [1][14] - The company faces significant operating expenses, which increased by 50% year-over-year, largely due to investments in AI and restructuring costs [4][13] Sales and Financial Performance - Tesla delivered 497,099 vehicles in Q3 2025, generating $21.2 billion in automotive revenue, marking the best revenue figure in over a year [3] - The profit for Q3 was $1.4 billion, a modest increase of $200 million from Q2 2025, but still significantly lower than previous years [3][2] - The company is under pressure to achieve another record quarter to match the number of cars shipped in 2024 or 2023 [9][10] Operating Expenses and Challenges - Operating expenses rose significantly due to spending on AI, R&D projects, and restructuring charges of nearly $240 million, with no clear explanation provided for the restructuring [4][12] - Tariffs also negatively impacted profits, costing the company around $400 million [5] Future Strategy and AI Focus - Musk emphasized the importance of AI and self-driving technology, stating that Tesla is at a critical inflection point in scaling these initiatives [6][11] - The company plans to start building the third version of the Optimus robot in Q1 2026, despite previous delays in production [12] - Increased capital expenditures are expected in 2026 due to ongoing AI and robotics projects, alongside rising employee-related spending to attract talent [13] Compensation Package and Shareholder Dynamics - Tesla is proposing a $1 trillion compensation package for Musk, which is set for a vote at the upcoming annual shareholder meeting [14] - Despite opposition from advisory groups, the package is likely to pass due to strong shareholder support [14] - Musk has expressed concerns about losing control of the company if the compensation package is not approved, indicating the high stakes involved [15]