Tesla is accelerating its pivot to artificial intelligence, with Elon Musk urging executives to spend aggressively even if efficiency suffers. Capital expenditure surged 142% year‑over‑year to $5.8 billion in Q2, funding new factories, production lines, and AI infrastructure for projects like the Cybercab robotaxi and Optimus humanoid robot.
Tesla Cash Flow Turns Negative Amid Heavy Investment
Musk told analysts that aiming for “high‑efficiency capital spend” would only slow progress, calling Tesla’s industrial scale‑up the fastest since World War II. The company posted negative free cash flow of $1.1 billion, its first shortfall since 2024, and expects total capex to exceed $25 billion this year.
CFO Vaibhav Taneja said Tesla is securing debt facilities to borrow up to $30 billion, with spending set to ramp up over the next three years, including a massive Terafab semiconductor fab. Tesla joins tech giants like Google in burning cash to stay ahead in the escalating AI race.
