Tesla is killing the Model S and Model X to build robots.
Six weeks ago, we wrote about robotics in the April Monument Trend Advisory issue.
The thesis came down to one line Jensen Huang delivered at Nvidia’s GTC conference in March: Every industrial company will become a robotics company.
Huang put a number on it the next day in the analyst session, calling the opportunity “something like $50 trillion, $60 trillion, $70 trillion” of the world’s industries waiting to be retooled.
We told you the timeline was compressing fast and the Q1 selloff was setting up one of the cleanest entry points of the decade.
Two weeks ago, Tesla confirmed it.
On the Q1 2026 earnings call, Elon Musk announced that Tesla is ending Model S and Model X production at Fremont in Q2. Not for a new EV. For Optimus humanoid robots.
Tesla is converting the original production lines for its most iconic vehicles into a robotics factory targeting 1 million units a year, with a second-generation facility going up at Giga Texas, designed for 10 million robots a year in the long term.
Musk said Optimus will represent 80% of Tesla’s future value.
Read that one more time. The most valuable car company in the world is killing two flagship products to make robots instead.
Then yesterday, Rockwell Automation reported its second-quarter earnings.
ROK is one of the largest pure-play industrial automation companies in the world, with a market cap of $48 billion.
The stock closed at $400 on Monday and at $435 yesterday after the print, up 10% on the day and trading at an all-time high.
Earnings came in at $3.30, beating the $2.88 expectation. The company raised its full-year outlook for the second time, and three numbers buried in the call confirmed the thesis we laid out in April.
Data Center Revenue Doubled
Rockwell’s data center sales more than doubled year over year. They walked the analysts through a deal at a new AI data center in Texas, where Rockwell is replacing the building’s commercial-grade controls with industrial Logix PLCs, the same hardware that runs heavy manufacturing.
The reason matters.
AI data centers are now operating at a scale that requires the reliability profile of a factory floor.
Automotive Is The Largest AMR Vertical
Rockwell told the analysts that automotive is the single largest vertical for their autonomous mobile robots. Not Amazon warehouses. Not the parcel handlers. Car factories.
They named a Subaru of Indiana win, where AMRs are scaling production by improving line flow. The robotics revolution in cars is happening on the factory floor before it ever happens inside the cars.
BHP Signed On For Autonomous Mining
Rockwell announced a strategic partnership with BHP, one of the world’s largest mining companies, to support the next generation of autonomous mining operations.
That’s robotics moving into one of the most expensive, dangerous, and capital-intensive industries on earth. The reason BHP signed up… the math has shifted.
Across the call, the same theme kept showing up.
Discrete sales up mid-teens, e-commerce and warehouse automation up over 30%, Logix up 20%, and Software and Control margins at 35%.
Book-to-bill came in above the historical corridor for the first time in the cycle.
This is what Jensen described in March, what Tesla confirmed two weeks ago, and what Rockwell printed yesterday.
YOUR ACTION PLAN
I’ll be honest with you. Sitting on the couch with my Achilles in a cast while Karim scouts international real estate without me has its upside.
I have time to dig. And I have been spending it going through the earnings calls of every company touching this trend.
ROK is one of them. There are several others I have been working through that I think have even bigger upside, names that are not yet trading at 50 times earnings and positioned where ROK was three years ago.
One of them flew completely under the radar this earnings season because it does not have “robotics” anywhere in its name.
That’s exactly why I want it.
I may not have a piña colada under the cabana… but I’ve got something better.