Musk’s AI5 Chip Promises 5X More Power for Tesla By 2027 – Moby
Tesla, SpaceX, and xAI CEO Elon Musk announced on his social media platform, X, that Tesla’s AI5, its next-generation custom AI processor, is near completion.
“Congrats to the @Tesla_AI chip design team on taping out AI5!” Elon Musk wrote on Wednesday. “AI6, Dojo3 & other exciting chips in the works.”
He also thanked Samsung and Taiwan Semiconductor @TaiwanSemi_TSC (not to be mistaken for TSMC), for their “support in bringing this chip to production.”
Musk says it’ll be one of the most-produced AI chips ever.
The market loved the announcement, sending Tesla, the market’s proxy stock for xAI and SpaceX at the moment, up 7.6%. UBS analysts upgraded TSLA from sell to hold on Tuesday, with the stock trading after hours on Wednesday at $392.68.
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If you’re confused by what Musk means when he says “taping out,” it means the chip’s layout is fully completed, verified, and sent to a semiconductor foundry. In this case, we can assume it will be Samsung based. The market is rewarding this news because it could mean that Tesla’s robotaxi brain, as well as Tesla’s Optimus humanoid robots, AI features, and maybe even their future data centers in space, are going to get an upgrade.
According to Musk himself: “A single AI5 has ~5 times the useful compute of a dual SoC AI4.” The dual SoC AI4 is Tesla’s current FSD/Autopilot computer used in production vehicles. Musk also stated in an episode of the “All-in Podcast” that the AI5 will have 8x more raw compute power than HW4 and “9 times more memory.”
Along with all the promises Musk has made about Optimus and data centers in space, the AI5 also aligns with his aspiration for Tesla owners to earn passive income through their “Robotaxi fleet.” The idea is that the owner’s car can earn money autonomously by giving paid rides when it’s not in use. Ignoring all legality of this idea, Tesla would theoretically take a commission while you pocket the rest.
That said, the AI5 chip needs to actually work because Tesla is far behind competitor Waymo. Tesla’s unsupervised robotaxi fleet in Austin has hovered between just 4 and 11 vehicles in recent months. Waymo, by contrast, already has over 1,500 vehicles across four cities and plans to add 2,000 more in 2026.
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