Ex Machina

After a choppy few weeks, the U.S. stock market’s deus ex machina has arrived: Nvidia’s ($NVDA) earnings report. The AI bellwether reported US$96.2B in revenue with an adjusted EPS of US$2.22.

Its data centre segment grew 117% YoY to US$89B, helped in part by a massive backlog for its Vera Rubin chips. We already know SpaceX ($SPCX) is using Vera CPUs in its first-gen Starmind AI satellites, likely deploying into orbit by late 2027.

But a segment of Nvidia’s balance sheet that gets less attention is robotics. It's folded into its Edge Computing segment which generated US$7.2B in revenue – a massive number that only represents a small percentage of the company’s bottom line. The fact that it’s a growing line item on the world’s largest company’s balance sheet could be a sign of bigger things to come.

Amazon ($AMZN) could be pushing into the sector too, with leaked documents outlining Project Tetromino, a US$530M initiative to fully automate its delivery stations using AI and robotics by 2029. 

It turns out, humans are fairly bullish on robots… particularly ones that can backflip. China’s humanoid robot maker Unitree surged 460% in its Shanghai IPO. Though the company’s CEO said this week that robotics’ ‘ChatGPT moment’ could still be years away. Elon Musk has also relayed Tesla’s ($TSLA) ambitions for robotics over several earnings calls, but Optimus deliveries won’t come any time soon. 

Making bigger leaps in the field is the still-private company Figure AI. It's already generating revenue from humanoid robots, according to CEO Brett Adcock, who also founded Archer Aviation ($ACHR).

The same ambition hasn’t stopped a once-struggling phone company from embracing the tech. Blackberry ($BB) has rallied 100% YTD, and its pivot to robotics through its QNX division is a big part of that.

The demand for physical AI components has roused investor interest in suppliers like Teradyne ($TER). The company’s Q2 revenue hit a record US$1.33B, with its robotics segment posting several consecutive quarters of growth.

Synopsys ($SNPS) and AMD’s ($AMD) chip design and silicon platforms are gaining traction as robotics workloads increase. 

Goldman Sachs ($GS) estimates robotics will be a US$38B market by 2035, despite the calibre of performance on display at the Humanoid Robot Games this week. The chips are already scaling, but the question investors are betting billions on is whether the robots can too.

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Samy Sriram

Markets Analyst

Samy is a markets analyst at Stake, with seven years of experience in the world of investing, working across roles in private banking, venture capital and financial media. She has a Master’s degree in Finance and Data Analytics from The University of Sydney Business School.