Elon Musk said Tesla Inc. needs to build and operate what he is calling a “TeraFab” to manufacture semiconductors, a massive undertaking that will cost billions of dollars and mark another expansion beyond what had been the company’s core electric vehicle business.

Instead, the company focused on its best-selling SUV and sedan, the Model Y, and Model 3, while sales of the Model S and X dwindled. When reporting sales, Tesla lumps all of its premium models together in the "other models" category, and in the last quarter of 2025, it sold only 11,642 of these, a 51 percent year-over-year decrease.

For the fourth quarter of last year, Tesla’s net income also plunged, down 61% to $840 million, or 24 cents. Excluding one-time charges, net income totaled 50 cents per share, compared to analysts’ forecasts of 45 cents.

The Tesla call has wrapped up and investors kept their focus on the eye-popping $20 billion capex number. Musk said that the company is making sure it can not only "scale to very high volume with autonomous vehicles,