Episode summary
Tesla Stock: Who Really Profits From Optimus?
Summary
The host argues that Tesla’s Optimus robot push is less important, at least for now, than the component companies that can supply humanoid actuators. Tesla has reportedly ramped production tenfold and wants 20,000 robots a week, but hand and forearm actuator problems, supplier constraints, and other equipment issues suggest the hard part is still underneath the brand story.
Actuators are described as the muscles of a robot, and a humanoid may need roughly 30 to 70 of them. The host says each must be strong, precise, compact, light, efficient, and cheap, which makes them difficult to build at scale. He argues that hands are especially hard because they need 10 to 20 degrees of freedom in a very small space, and that nobody has mass-produced these parts for consumer humanoids before.
At this stage of the product cycle, he says actuators can account for 50% or more of a humanoid’s bill of materials, so pricing power should sit with the suppliers first. Over time, he expects that balance to shift toward Tesla and other robot brands, just as automakers and retailers eventually squeeze suppliers. His investing framework is to identify actuator companies with durable advantages, then separate great companies from expensive stocks.
Key takeaways
- The host says Tesla’s Optimus push is being slowed by hand and forearm actuator problems, not just general robotics complexity.
- He estimates a humanoid needs roughly 30 to 70 actuators, making the component market a major bottleneck.
- The host argues actuators can be 50% or more of a humanoid’s bill of materials, so supplier pricing power is strongest early.
- He expects the value chain to shift over time toward robot makers like Tesla, similar to how automakers and Walmart pressure suppliers.
- The host wants investors to focus on actuator firms with a durable five-year advantage, but only if the stock price is attractive.
Notable quotes
“Tesla ramped up production of its Optimus humanoid robot tenfold in recent months”
“So, a humanoid, and I have some stuff here, needs roughly 30 to 70 actuators, and each of them has to be strong, precise, compact, obviously light, efficient, and cheap all at once”
“at this stage of the product life cycle, actuators are 50% or more of the humanoids' bill of materials”
“the question is what's the stock worth? Those are different questions”
How the episode opens
Good morning. This is Dylan Jovine behind the markets. Happy Wednesday.
Today is Wednesday, October 21st. Happy birthday, Mom. Anyway, today I'd like to talk about robots and the opportunities in front of us and what brought this on is a lot of the best ideas I've had in my career have been reading annual reports or quarterly reports and looking at where big companies are directing their capital spending.
And what they do is CEOs when they talk about the future, they say we're investing in this and they really paint a picture of the future which, you know, if you read very, very carefully isn't too hard to unpack and that's what I've really started to do as I believe robots are going to be a very, very big deal for us and I think their time is actually coming and I base that on the fact a few things that I'll discuss with you right now. So, Tesla ramped up production of its Optimus humanoid robot tenfold in recent months. But its production has really hit a few snags.
It's grappling with problems that involve the robot's hands, supplier constraints, and other automated equipment and their goal is to get it to 20,000 robots a week. So, I say to myself when I'm dealing with situations like this and I read about all these other companies in Germany and other funds that are getting robots, VCs investing heavy in robots, I say where is this going? Where are the bottlenecks here?
Where is the value going to be captured? And I've really been kind of on a deep dive the past few weeks and one of the big areas of opportunity for us, I've come to learn, are actuators and actuators are kind of the muscles of a robot.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- optimus robot production
- robot actuators
- tesla supply chain pricing power
- robotics bill of materials
- ei era report
Companies and tickers mentioned
- TSLA
- WMT
- GM
- Tesla
- Walmart
- General Motors
Watch the episode
Watch “Tesla Stock: Who Really Profits From Optimus?” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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