ARK Invest has updated its valuation model for Tesla Inc. (TSLA), projecting the stock could reach $4,400 per share by 2031. That figure represents a nearly twelvefold increase from its October 19 closing price of $368.06, even as shares remain down 18.16% since January 1.
Robotaxis and Optimus Drive Tesla's Valuation
According to analysts Tasha Keeney and Daniel Maguire, autonomous ride-hailing accounts for approximately 80% of Tesla's projected 2031 enterprise value. In ARK's updated base case, a fleet of 8.1 million robotaxis is expected to generate $753 billion in net ride-hail revenue in 2031.
Additionally, Tesla's Optimus humanoid robot is projected to add $212 billion from approximately 1 million units sold to external buyers. To power these autonomous systems, ARK anticipates Tesla's cumulative artificial intelligence infrastructure spending will grow from about $7 billion at the end of 2025 to $225 billion by 2031, driving total annual revenue to $1.45 trillion.
ARK noted that the enterprise value contribution from robotaxis dropped from ~90% in its 2029 model (published in 2024) to ~80% in 2031 because "Optimus Robot-as-a-Service (RaaS) is likely to inflect as robotaxis continue to proliferate." Meanwhile, auto sales in the base case are projected to expand from 1.6 million vehicles in 2025 to 10.2 million in 2031.
Execution Risks and Upcoming Quarter Earnings
While Tesla launched its commercial robotaxi service in Austin, Texas, in June 2025—expanding to 7 cities across 3 states and logging over 1 million unsupervised driverless miles in roughly 7 months—ARK labeled overall progress slower than originally anticipated. ARK cited four main risks to its forecast:
- Slower-than-expected robotaxi ramp and regulatory delays.
- A sudden departure by CEO Elon Musk, whose high-profile actions frequently draw market scrutiny like his recent SpaceX share pledges.
- Potential natural disasters.
- Global pandemics.
Industry analyst Dan Ives of Yorkville Ives & Co. expects robotaxis to expand to more cities in early-to-mid 2027, with Optimus deployments following later that year. Market observers are also weighing tech sector valuation expectations following broader warnings about AI return sustainability.
Tesla is scheduled to report third-quarter earnings on October 21. Analysts tracked by Nasdaq expect earnings per share of $0.21, down from $0.37 in the prior-year period.
Key Takeaways
- Price Target: ARK sets a $4,400 2031 target for TSLA, up from its $368.06 close on October 19.
- Revenue Drivers: Robotaxis are projected to generate $753 billion from 8.1 million vehicles, while Optimus adds $212 billion.
- AI Infrastructure: Cumulative AI capital expenditure is forecast to reach $225 billion by 2031.
Why It Matters
ARK’s valuation model illustrates how major asset managers are shifting from evaluating legacy automakers on vehicle delivery volume to valuing them as software and robotics platforms. If Tesla succeeds in scaling its autonomous robotaxi fleet and Optimus robotics division, it could establish a precedent for AI-driven hardware monetization. However, failure to meet steep autonomous driving milestones or AI infrastructure buildouts leaves high-valuation tech equities vulnerable to sharp repricing.
