The next phase of Tesla's growth is in physical AI, says Barclays' Dan Levy

Core Viewpoint - Tesla is undergoing a significant pivot from traditional automotive models to a focus on physical AI, including autonomous driving and humanoid robots, marking a new phase in its growth [2][4]. Valuation Insights - Tesla's valuation remains challenging, with a market capitalization exceeding $100 billion and trading at over 150 times forward earnings, indicating a disconnect between stock price and near-term fundamentals [4][5]. - The market is currently placing less emphasis on near-term earnings, suggesting that Tesla's stock may remain elevated due to strong retail and technical support [5][6]. Robo Taxi Development - The primary focus for Tesla this year is on scaling the commercialization of its robo taxi service, with efforts to expand operational design domains (ODD) and compete against established players like Waymo [8][13]. - Tesla's potential cost advantage in the robo taxi market is significant, as its vehicles could be priced around $30,000 compared to competitors like Waymo, which costs between $100,000 to $150,000 per vehicle [13]. Humanoid Robot Progress - The humanoid robot initiative is still in the research and development phase, with initial production of the Gen 3 version expected later this year, but the market remains cautious until more concrete advancements are demonstrated [9][15]. - Tesla's AI capabilities and supply chain advantages are seen as key factors that may support its humanoid robot ambitions, despite competition from other players in the market [16][17].