Tesla Has One Big Financial Question to Answer for Investors: Morgan Stanley

Morgan Stanley analyst Andrew Percoco says Tesla must answer one significant financial question for investors as the company pushes forward with its Robotaxi rollout, Full Self-Driving software, and Optimus robot.

What Happened

In a note to investors on Tuesday, Percoco acknowledged that investors remain broadly positive about Tesla's direction. However, he said Morgan Stanley wants clearer evidence of progress in two specific areas: Robotaxi scaling and tangible proof points for the Optimus humanoid robot. The analyst cited elevated spending as a key concern—CEO Elon Musk has indicated this spending will increase as Tesla accelerates Robotaxi development and continues Optimus work. Percoco noted that weaker gross margins combined with higher R&D spend have sharpened investor focus on measurable outcomes from both projects.

Why It Matters

For current owners and potential buyers, the financial scrutiny reflects broader questions about Tesla's long-term roadmap beyond vehicle sales. While bulls point to FSD as proof of Tesla's ability to develop physical AI, investors want operational evidence that Robotaxi can expand safely in existing cities while improving ride frequency. On Optimus, Percoco said he is looking for concrete milestones beyond commentary around start of production timelines. These projects represent significant capital commitments that could affect pricing, software subscription costs, and the overall value proposition of Tesla vehicles.

The Bottom Line

Morgan Stanley maintains a $415 price target on TSLA with a Hold rating. Percoco took over coverage from long-time analyst Adam Jonas, who shifted to Tesla's automotive side. The stock was trading around $330 at publication time.