Morgan Stanley Highlights Key Factors That Could Shape Tesla’s Stock
Tesla’s annual general meeting offered investors more than just the approval of Elon Musk’s $1 trillion compensation package, according to a new analysis from Morgan Stanley.
In a research note, analyst Adam Jonas said that while the shareholder vote was the “most important takeaway,” several other developments discussed during the meeting could influence Tesla’s stock performance over the next 6 to 12 months.
Tesla’s Strategic Ties to xAI Under Review
One major topic, Morgan Stanley noted, is Tesla’s ongoing investment in xAI, Musk’s artificial intelligence startup. Jonas suggested that the company will “have to revisit” this relationship, emphasizing that Tesla’s collaboration with xAI—both financially and strategically—will be crucial to its long-term success.
He explained that Tesla’s data, software, hardware, and manufacturing synergies create a unique feedback loop, positioning the company for a deeper integration of AI technologies.
The Next Leap in Full Self-Driving Technology
Jonas also drew attention to Musk’s comments about Tesla’s Full Self-Driving (FSD) software, specifically the upcoming version 14.3, which Musk said will allow drivers to “text while driving.”
Morgan Stanley described the moment as a turning point, calling it a “steam engine” moment for transportation—a comparison highlighting the potential revolution as responsibility for safe driving transitions from human control to AI algorithms.
Tesla’s Chip Ambitions and AI Cloud Vision
Another notable highlight was Musk’s suggestion that Tesla might build a massive semiconductor fabrication facility to support its AI and robotics ambitions. Morgan Stanley said such a move would help ensure a resilient chip supply and accelerate innovation through vertical integration of Tesla’s AI “inference brain.”
Jonas also discussed Musk’s long-term vision for a “distributed inference cloud”—a future where idle Teslas perform AI computations when not in use. The analyst believes this could lead to a vast network of interconnected vehicles, forming a global web of distributed intelligence powered by billions of AI-enabled processors.
