Tesla wants AI and software to be its next profit engine

Tesla is betting that AI and software subscriptions can deliver the margins its auto sales can’t, as it pushes deeper into autonomy. Five days after Elon Musk’s viral “flying” Roadster stunt using compressed-gas thrusters developed by SpaceX, he said Tesla and another company were exploring a merger to accelerate its autonomous-driving drive. The broader auto industry is also shifting toward recurring software and AI revenues, amid pressure from Chinese EV rivals. Tesla still relies on cars for 75% of total revenue and will need major spending to compete with Big Tech on AI. Analysts point to Full Self-Driving as the near-term growth lever, with 1.7 million active subscriptions worldwide and 75%+ of new Teslas in North America sold with supervised FSD.