Tesla’s (NASDAQ:TSLA) recent annual general meeting gave investors plenty to digest beyond the approval of Elon Musk’s $1 trillion compensation package, according to a report by Morgan Stanley.
Analyst Adam Jonas wrote to clients that while the shareholder vote was the “most important takeaway,” there are several other developments that could “matter to the share price over the next 6 to 12 months.”
One major factor, Morgan Stanley emphasized, is Tesla’s pending investment in xAI.
“They’re gonna have to revisit this,” Jonas said, noting that “Tesla’s relationship with xAI (financially and strategically) is deterministic to the long-term success of Tesla due in part to the natural synergies of data, software, hardware and manufacturing in recursive loops.”
Jonas also drew attention to Musk’s comments about Full Self-Driving technology, particularly his claim that version 14.3 will allow drivers to “text while driving,” which was met with loud applause.
Morgan Stanley described this as a pivotal moment, stating that “transferring the responsibility for safe operation of a vehicle from human to algorithm represents a ‘steam engine’ moment for transportation.”
Another key point was Musk’s hint that Tesla might need to “build a gigantic chip fab.”
According to the bank, such a move would help guarantee “resilient supply and continued innovation” as the company aims to further vertically integrate production of the “inference brain” that powers its robotics and AI systems.
Finally, Jonas underscored Musk’s ambition to create a “prodigious distributed inference cloud,” in which idle Teslas could take on AI computing tasks.
The analyst believes this could ultimately consist of “tens of billions of Blackwell-equivalent inference computers at the edge,” forming a worldwide network of “swarming, distributed, low-latency intelligence.”