Morgan Stanley analysts predict Tesla’s Dojo supercomputer could fuel a staggering $500 billion increase in the electric vehicle maker’s market value. This optimistic forecast influenced Tesla’s stock to surge more than 6% in early morning trading on Monday as investors considered the automaker’s significant tech advancements.
The prospects of the supercomputer at Tesla were likened by these analysts to the propulsive force Amazon Web Services provided for Amazon, which substantially uplifted their profitability. The note they disseminated stated, “Investors have long debated whether Tesla is an auto company or a tech company. We believe it’s both, but see the biggest value driver from here being software and services revenue.”
Five years in development, Dojo is an in-house supercomputer designed to equip AI systems with the ability to handle intricate tasks. It notably enhances Tesla’s driver-assistance system Autopilot and significantly propels the “Full Self-Driving” efforts of the company.
The anticipation of Dojo, according to the Morgan Stanley analysts, is that it will reveal “new addressable markets that extend well beyond selling vehicles at a fixed price.” They suggested that the forthcoming version of Tesla’s full self-driving system, slated for unveiling by year’s end, and Tesla’s subsequent AI day, predicted for early 2024 but not yet officially announced, are “worth watching.”
Even as Tesla’s shares have doubled since the start of the year, they are still noticeably shy of the record intraday peak of $414.50 achieved in November 2021. As of market closure on Friday, the market cap of the world’s most valuable carmaker stood at about $788.74 billion.
