Tesla Q1 2026 Update — reading text

the Reinforcement 8.0 Learning stage of training to better handle “long-tail” edge cases, enhanced the neural network 7.0 vision encoder for sharper perception in low-visibility scenarios and rewrote the AI compiler to 6.0 accelerate model iterations as well as the runtime to cut inference latency by up to 20%. These 5.0 4.0 architectural advances will help accelerate our efforts to eventually deploy unsupervised 3.0 autonomy on both the Robotaxi fleet and customer-owned vehicles. Digital Optimus represents 2.0 the next evolution of our AI development. We are working on automating digital workloads, 1.0 building an intelligence layer that will complement the real-world AI we have built to operate 0.0 vehicles and humanoid robots. AI Inference Compute Cumulative Miles Driven with FSD (Supervised) 1 (billions) Coinciding with Robotaxi and Optimus ramps, we are expanding our scope of manufacturing to include semiconductor fabrication, an important step to ensure sufficient and resilient chip supply. Our partnership with SpaceX aims to build the largest chip fab ever: vertically integrating logic, memory and advanced packaging to allow for rapid iteration as we anticipate greater chip demand than what existing and planned industry capacity can accommodate. This begins with the Tesla-owned Research Fab on our Gigafactory Texas campus. In April, we completed the final chip design of our next-generation AI5 inference processor. Automotive and Other Software In April, we began rolling out the Spring Update which includes a new in-vehicle Self-Driving App (AI4 vehicles) – users can subscribe to FSD (Supervised) 1, learn how to use the feature and view ongoing stats. Customers can launch Grok by saying “Hey Grok,” and set location-based reminders. Accent lights can now turn red when an object is in your blind spot and your turn AI5 Tape Out signal is engaged. Pet Mode allows users to name their pet and choose between dog, cat or 8 (1) Active driver supervision required; does not make the vehicle autonomous hedgehog.  SERVICES Robotaxi 1,800,000 Cumulative Paid Robotaxi Miles In Q1, paid Robotaxi miles nearly doubled sequentially. Once in production, we expect that 1,600,000 1,400,000 Cybercab will begin to replace the existing Model Y fleet and will be the largest volume vehicle in 1,200,000 the fleet over time. We continued laying the groundwork for expansion of our Robotaxi service to 1,000,000 additional major U.S. metros, including testing and permitting, allowing us to quickly launch new 800,000 markets once we are ready. Our top priority remains safety. We further expanded our 600,000 unsupervised operation area in Austin and launched unsupervised rides in both Dallas and 400,000 Houston in April. 200,000 0 FSD (Supervised)1 We began moving FSD (Supervised) to subscription-only. Adoption (attachment to new purchases) and penetration (total users among the eligible fleet) both continued to grow, with record net Cumulative Paid Robotaxi Miles new subscriptions in Q1. A major focus is increasing awareness of the safety and convenience provided by FSD (Supervised) as we evolve our sales strategy to position FSD (Supervised) as the State Metro Status product, with promising early signs. We received approval to deploy FSD (Supervised) in the California SF Bay Area Safety Driver3 Netherlands in April, which clears the path for potential approval in other EU countries. We Texas Austin Ramping Unsupervised continue to make progress on approval in China. Dallas Ramping Unsupervised Houston Ramping Unsupervised Automotive Services Arizona Phoenix Preparations Underway We continue to invest in ancillary services to increase the convenience for our customers while Florida Miami Preparations Underway lowering total cost of ownership. With the continued rapid progress on FSD (Supervised) 1, the Orlando Preparations Underway latest version of Safety Score enables every mile driven with FSD (Supervised) to receive a score of 100, enabling Tesla insurance customers2 to maintain a higher Safety Score over time, resulting in Tampa Preparations Underway lower monthly insurance premiums. The reduction in premiums, in certain cases, can more than Nevada Las Vegas Preparations Underway compensate for the monthly price of FSD (Supervised). Announced Near-Term Planned Robotaxi Coverage (1) Active driver supervision required; does not make the vehicle autonomous. 9 (2) Applies to new policies in Indiana, Tennessee, Texas, Arizona, Virginia and Illinois (3) Pursuant to CA TCP permit # TCP0046782 - A  OUTLOOK Volume We are focused on maximum capacity utilization at our factories. Deliveries and deployments will be impacted by aggregate demand for our products, supply chain readiness and allocation decisions between sale to customers or use for our owned and operated fle et. Cash We will manage the businesses such that we ensure a strong balance sheet, maintaining sufficient liquidity to fund our product roadmap, long-term capacity expansion plans – including further vertical integration – and other expenses. Profit While we continue to execute on innovations to reduce the cost of manufacturing and operations, over time, we expect our hard ware- related profits to be accompanied by an acceleration of AI, software and fleet-based profits. Product We continue to evolve and augment our product lineup with a focus on cost, scale and future monetization opportunities via se rvices powered by our AI software. We remain focused on growing our sales volumes through a differentiated and efficiently managed p roduct portfolio, which includes leveraging and optimizing our existing production capacity before building new factories and produc tion lines. Cybercab, Tesla Semi and Megapack 3 are on schedule for volume production starting in 2026. First-generation production lines for Optimus are being installed in anticipation of volume production. Capacity build out and ramp related to our multi-year infrastructure initiatives, including AI compute, solar, battery material and semiconductor manufacturing are underway. 10 PHOTOS & CHARTS  CO RT EX 2 – BUILD IN G CONSTRUCTION AT GIGAF AC TO RY T EXAS 12  CO RT EX 2 – AI T RAINING CLUSTER 13  MEGAFACTORY TEXAS – BODY – IN – WHIT E LINE 14  TESLA SEMI – PRODUCTION LINE 15  OPTIMUS FACTORY SITE PREPARATION – GIGAFACTORY TEXAS IN THE BACKGRO UND 16  RESEARCH FAB – GROUND BRE AK ING 17  LFP FACTORY – FIRST PRODUCTION MODULES 18  CYBERCAB T EAM – START OF P ROD UCTION AT GIGAF ACT ORY TEXAS 19  CYBERCAB T EAM – START OF P ROD UCTION AT GIGAF ACT ORY TEXAS 20  K E Y MET RICS QUARTERLY (Unaudited) 0.5 7 8 6 7 0.4 5 6 4 5 0.3 3 2 4 0.2 1 3