Tesla said it will more than double capital expenditures to over $20 billion this year to fund six new factories, AI infrastructure, and robotics production as the company pivots away from its EV business.
The planned spending represents a 135% increase from the $8.5 billion invested in 2025 and marks the largest annual capital outlay in the company’s history.
Tesla‘s capex had grown steadily from $1.3 billion in 2019 to $11.3 billion in 2024 before falling 25% to $8.5 billion last year.
The announcement came as Tesla reported its first annual revenue decline since going public, with full-year sales falling 3% to $94.8 billion.
“This year is going to be a huge investment year from a CapEx perspective,” Chief Financial Officer Vaibhav Taneja said on the earnings call Wednesday. “At the moment, we are expecting that CapEx would be in excess of $20 billion.”
Six Factories
Taneja said Tesla will pay for six factories this year, including facilities for its lithium refinery, LFP batteries, Cybercab, Semi, a new Megafactory, and Optimus production.
“There’s about six factories which we are starting production in this year. So there’s a lot of cash CapEx going into that,” Taneja said. “As we are trying to scale Optimus, we need a lot more compute. We’re putting more money towards compute as well.”
“And then for training,” CEO Elon Musk added.
The company will also spend to expand capacity at existing factories and build related infrastructure, including further expansion of its robotaxi and Optimus fleets, Taneja said.
The CFO noted that the $20 billion figure does not include potential spending on a solar cell manufacturing facility or a semiconductor chip fab, which Musk said would come later.
“Those would be, as Elon mentioned, would come later on,” Taneja said. “Those are infrastructure plays. That funding takes a little bit longer.”
Funding Strategy
Taneja said Tesla will initially fund the investments using internal resources, with the company holding over $44 billion in cash and investments on its balance sheet.
“There are ways where we can fund it especially when we look at the robotaxi fleet because anytime you have a consistent stream of cash flow, you can go and get money from the banks,” Taneja said. “We have had conversations with banks about it.”
For infrastructure projects like the chip fab and solar manufacturing facility, Taneja said the company will need to explore additional funding options.
“Given that it’s an infrastructure play, it’s a longer tail, we will have to look at a little bit more in terms of how we fund it. Whether it’s through more debt or other means,” he said.
Revenue Decline
The capex surge comes as Tesla‘s annual revenue fell 3% to $94.8 billion in 2025, the first decline since the company went public.
“While automotive sales declined sequentially, gross margin (even when excluding the impact of regulatory credits) improved,” the company said in its shareholder deck.
Tesla also disclosed that it has invested approximately $2 billion in xAI, the artificial intelligence company founded by Musk that developed the large language model Grok.
Q4 Results
The Austin, Texas-based company posted adjusted earnings per share of $0.50, beating the $0.44 analyst consensus based on Tesla‘s survey of 19 analysts. Revenue came in at $24.9 billion, above the $24.5 billion estimate.
GAAP earnings per share were $0.24, with net income of $840 million. Operating margin stood at 5.7% while gross margin came in at 20.1%.
