Introduction: In the fast-evolving landscape of electric vehicles (EVs), Tesla has consistently pushed boundaries, not just with its groundbreaking automotive technology but also with its foray into Tesla’s Full Self-Driving (FSD) software. Recent insights from Goldman Sachs reveal a staggering valuation for Tesla’s FSD, projecting an annual revenue between $1 billion and $3 billion, with a jaw-dropping upside potential of $75 billion by 2030.
The Surge of Tesla Stock
Amidst the dynamic market, Tesla’s stock (TSLA) has experienced a meteoric rise, escalating by 10% within a single week. This surge is attributed to factors such as speculation around interest rates and promising reports of EV incentives in India. However, the real catalyst lies in Tesla’s strategic diversification beyond automotive pursuits, catching the attention of investors looking at the long game.
Goldman Sachs’ Insight
In a comprehensive analysis titled “Contextualizing Tesla’s AI and FSD opportunities,” Goldman Sachs’ Mark Delaney and his team delve into the expansive landscape of software products and services, encompassing hardware, artificial intelligence (AI), and data. Their findings shed light on the monumental potential of Tesla’s FSD, currently in beta testing but already contributing significantly to the company’s annual revenue.
Valuation Breakdown
Tesla charges an upfront fee of $12,000 for its FSD software or offers a subscription model at $199 per month. Delaney’s valuation posits that, even in its beta phase, FSD is a billion-dollar asset. Looking forward, the market opportunity for FSD is projected to reach an astounding $75 billion annually by 2030, driven by Tesla’s expanding fleet of vehicles.
FSD Revenue Projections
Mark Delaney’s models outline a spectrum of revenue scenarios for 2030. Excluding vehicle sales, the FSD sector alone could contribute tens of billions, ranging from $10 billion to an astonishing $75 billion per year. This underscores the transformative potential of Tesla’s software ventures.
Beyond Vehicles: Tesla’s Diversification
Delaney’s analysis doesn’t stop at FSD. The report breaks down revenue projections for various Tesla businesses. Software, predominantly FSD, emerges as a juggernaut, potentially valued at $115 billion to $225 billion. Services and other revenue streams, including Optimus humanoid and the Supercharger Network, could range from $75 billion to $100 billion, with energy contributing an additional $30 billion to $50 billion.
Conclusion
As Tesla’s stock continues to soar, the allure of its non-automotive ventures, especially the Full Self-Driving software, is undeniable. The projections by Goldman Sachs paint a vivid picture of a future where Tesla’s software empire could rival or even surpass its automotive prowess. Investors and enthusiasts alike are now closely watching as Tesla drives towards a revolution that extends far beyond the roads, into the realms of AI and FSD dominance.