Hi everybody and welcome back to the Elon Musk podcast where we
discuss all things technology, space, entrepreneurship and
more. And today we're talking about
something that's definitely caught the attention of Wall
Street Tesla shareholders and a I enthusiasts alike.
Tesla stock is climbing higher is something to do with the very
own supercomputer at Tesla Dojo. Recently, Morgan Stanley
upgraded Tesla stock from equal weight to overweight and hiked
the price target from $200.00 to $400.00.
But this optimistic outlook largely stems from their view of
Dojo's immense potential, not just in advancing Tesla's A I
capabilities, but also as a service that could be offered on
its own. Now, Dojo's goal is to
effectively process millions of terabytes of video data captured
from real life driving situation from Tesla's plus 4 million
cars. Now this goal led to a
considerably different architecture than conventional
supercomputer designs and going live in July 2023, Dojo serves
as the training ground for Tesla's machine learning models
aimed at bolstering its full self driving system or FSD.
And unlike conventional supercomputers, Dojo is
architected to handle millions of terabytes of real life video
data from over 4 million Tesla vehicles on the road right now.
Now this unique task called for an architecture that broke away
from traditional supercomputer designs, focusing on efficiency
and scalability. Now, before Dojo, Tesla was
already a formidable name in computing.
The company had several parallel computing clusters, one of which
was, by some metrics, among the top supercomputers globally.
However, there were debates about its actual performance due
to unclear metrics. These test the GPU clusters were
pivotal in training neural networks to better understand
real world driving conditions, and with MOJO, Tesla aims to
supersede its own lofty standards.
Mentioned first in 2019 during Tesla's Autonomy Investors Day,
MOJO faced some blaze due to power and thermal challenges.
Nevertheless, it officially came into the limelight in 2021 and
moved into production use in 2023, equipped with 10,000
NVIDIA H100GP U's to enhance his performance.
Now Dojo's reception among analysts is mixed, yet mostly
positive. And while some say it's
impressive but won't change the supercomputing game, others call
it an inhouse developed game changer that can massively speed
up the development of autonomous vehicles.
Now the endorsement from Morgan Stanley is particularly
significant, suggesting that Dojo could be a catalyst for an
unprecedented increase in Tesla's market value.
The idea is that Tesla's focus on custom designed a I chips for
video training could afford a formidable advantage in the
autonomous vehicle sector and beyond.
At Tesla's A I day in 2021, the introduced Dojo, but at the time
they were just getting started. They had a first chip and some
training tiles, but we're still in the process of constructing a
full Dojo cabinet in a cluster. Fast forward to a I day 22.
They made considerable headway, including developing a full
system tray, and they're aiming to ramp it up to a 100 exaflop
capability by the end of 2024. This is particularly significant
as Tesla's ambitions becoming increasingly computer
constrained, especially in selfdriving endeavors.
Moreover, Tesla's feature doesn't just rest on car sales.
Supercharging network with partnerships like the one
they've received established with Hilton Hotels presents
another potential revenue stream.
Adam Jonas believes that the advantages and the advancements
and chip technology will add to this by possibly extending the
self driving licensing and operating system licensing.
Now let's talk numbers for those who love them.
Morgan Stanley's price target shift from 2:50 to 400 isn't
trivial. The analyst broke down the value
and factored in Dojo's impact on the overall valuation.
This was a pivotal enough shift to lift Tesla stock by nearly
10% following the notes release. And get this, aside from Tesla,
Morgan Stanley also sees the possibility of non Tesla fleet
licensing revenue, which means the reach of Tesla's
technological advancements could go beyond its own lineup of
electric vehicles. And while the core business of
Tesla has always been tied to electric vehicles, this new
focus on Dojo is a revenue generator isn't really a wild
shift. In fact, we've mentioned this
before. The Dojo could potentially be
offered as a service, argumenting its utility and
contributing to Tesla's overall value.
So the concept isn't new. But what is notable is how
mainstream financial analysts are now seeing Dojo not just as
a little side project for Tesla for their own vehicles, but as a
key aspect of Tesla's future growth and the value.
Now. One more thing before we go
There are other market forces at play.
Currently, there's a looming potential of a massive UAW
strike that can negatively affect Tesla's competitors.
This labor strike in competing companies could inadvertently
give Tesla a huge edge, further fueling optimism around Tesla
stock and future prospects. That wraps up the show today.
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O thanks for tuning in and please take care of yourselves
and each other and I'll see you in the next one.