Tesla invests $2 billion in xAI, confirms Cybercab production this year

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Tesla said it will invest $2 billion in xAI, the artificial intelligence company founded by its chief executive Elon Musk, while reaffirming that production of its Cybercab robotaxi remains on track to begin this year. The move underscores Tesla’s strategic shift from a traditional electric vehicle maker toward an AI- and autonomy-focused business model.

The investment supports Tesla’s push into self-driving technology and robotics, areas central to its long-term valuation. Management said factory investments tied to Cybercabs, humanoid robots, Semi trucks, and the Roadster will drive capital expenditures above $20 billion this year, more than double prior levels. Shares rose after the announcement but pared gains as investors weighed the scale of spending.

Tesla said it will stop selling the Model S and Model X, reallocating factory space to robotics production. While its core EV business remains under pressure from competition and pricing incentives, the company highlighted progress in margins and strong growth in its energy generation and storage segment.

Musk reiterated expectations for broader autonomous deployment, though regulatory hurdles remain for the Cybercab, which is designed without a steering wheel or pedals. Investors are watching rollout milestones closely as Tesla seeks to convert long-promised autonomy into tangible revenue.

Apple warns rising memory costs as AI chip demand tightens supply

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Apple warned that increasing memory chip prices are beginning to weigh on profitability, as major suppliers shift production toward higher-margin chips used in artificial intelligence systems. Chief executive Tim Cook said market pricing for memory has risen sharply and is expected to have a greater impact in the current quarter, following only limited effects during the key holiday period.

The comments echo recent warnings from South Korean chipmakers Samsung Electronics and SK Hynix, which together dominate the global DRAM market. Both companies have been prioritising high-bandwidth memory used in AI servers, tightening supply of conventional DRAM chips used in smartphones, personal computers, and consumer electronics.

Apple is likely to require more memory components as demand for its latest iPhone models remains strong, particularly in China and India. However, the company declined to say whether higher component costs could translate into increased product prices. Analysts warn that sustained memory shortages could pressure margins across the consumer electronics sector and disrupt supply chains.

Chipmakers have also become more cautious about expanding capacity after years of aggressive investment, limiting the pace at which supply can respond. As AI infrastructure spending accelerates, memory availability for traditional devices is expected to remain constrained, contributing to weaker outlooks for global smartphone and PC shipments in the coming years.

US considers Robinhood to manage Trump-backed investment accounts for children

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The U.S. government is considering selecting Robinhood to help oversee new government-supported investment accounts for children, known as “Trump accounts,” according to a Bloomberg News report citing people familiar with the matter. The program would involve opening accounts for millions of U.S. children and placing Robinhood in a trustee role for the initial rollout.

The report said Robinhood has begun internal preparations in case it is chosen, while other major investment firms such as Fidelity Investments and Vanguard Group have not been approached for the first phase. The U.S. Treasury Department is expected to select up to three firms to serve as initial trustees, with a decision anticipated soon. Neither Robinhood nor the Treasury immediately commented on the report.

The accounts were announced this week by Donald Trump as part of a government-backed initiative aimed at encouraging long-term investing. Under the plan, the U.S. Treasury Department would deposit $1,000 into an investment account for every child born in the United States between 2025 and 2028. Treasury estimates suggest roughly 25 million families could qualify.

The administration projects that, without any additional contributions, the accounts could grow to about $5,800 by the time beneficiaries reach age 18. Trump has also urged U.S. businesses to contribute to the accounts on behalf of employees’ children, potentially increasing long-term returns. The proposal represents a significant expansion of government involvement in retail investing and could elevate the role of fintech platforms in public financial programs.