Musk Says Tesla Buyers Want FSD First, Car Second on Q2 Earnings Call

Tesla held its second-quarter 2026 earnings call on Wednesday, with CEO Elon Musk spending most of his opening remarks on robotaxi, Optimus, and what he described as the biggest manufacturing buildout the company has ever attempted. Revenue came in at $28.24 billion, up 25.52 percent year over year, though earnings of $0.33 per share missed expectations. Tesla stock fell more than 14 percent on Thursday.

Musk opened by calling out record Q2 deliveries and said Full Self-Driving has become a bigger sales driver than the vehicles themselves in markets where it is approved.

“And we’re seeing in locations that have FSD approved, we’re seeing a very high take rate of FSD. And in fact, I think, for a lot of people, they’re actually buying Tesla full self-driving with a car attached as opposed to a car with FSD,” Musk said. “They’re coming into our stores in the U.S. and they want the full self-driving and with whatever car comes with essentially.”

CFO Vaibhav Taneja backed that up with numbers, saying about 55 percent of North American deliveries in Q2 had an FSD subscription enabled at the time of delivery, with paid FSD customers now approaching 1.5 million globally.

On robotaxi, Musk laid out why Tesla is scaling carefully rather than flooding cities with vehicles.

“Although there are, I think, 30,000 to 40,000 automotive deaths per year in the United States alone, most of those do not generate any press or — you never really read about almost any of those. But if we injure even one person, it will be worldwide headline news. And regulators will immediately clamp down on our activities,” he said. “So we’re going as fast as humanly possible in scaling robotaxi with while trying to ensure that we do not harm anyone at all and ideally do not even run over a pet.”

AI chief Ashok Elluswamy said the fleet has driven more than 380,000 unsupervised miles across six cities in two states with zero notable incidents, and that weekly miles have been growing at double-digit rates.

Optimus took up a large chunk of the call, and Musk was blunt about how hard the production ramp will be.

“This is going to be the hardest product to scale manufacturing that we’ve ever made at Tesla because everything on the robot is new,” he said. “But with Optimus, there is no supply chain. So we’ve had to build up the supply chain in its entirety or in-house the production.”

He also tried to set expectations on timing. “Optimus will follow the sort of normal S-curve of a manufacturing ramp, but the initial portion of the S-curve will be quite flat and long because of the newness of the parts and the robot,” Musk said.

Looking further out, Musk said Optimus 4 will be built in Austin with a much more vertically integrated supply chain, targeting “aspirationally 10 million units a year versus 1 million units a year of Optimus 3,” with heavy caveats about how difficult that is to pull off.

Capital spending is running above $25 billion for the year, and free cash flow went negative in the quarter. Musk said that is deliberate.

“So it’s okay to be a little less capital efficient if we get things done sooner because that’s actually going to be the higher NPV outcome for the company,” he said, later adding that “probably this is the fastest industrial scale-up since World War II in America.”

Musk also thanked chip suppliers by name, singling out Micron for memory allocation “on reasonable terms given the pretty insane pricing of memory these days,” along with TSMC and Samsung for fab investments in Arizona and Texas.

One other note for Semi watchers: Musk said self-driving on the Tesla Semi should arrive “probably around the end of this year or early next year,” but that it is taking a backseat while the team focuses on Model 3, Model Y, and Cybercab.