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Tesla stock goes up after Morgan Stanley says the Dojo supercomputer could make the company worth $500 billion more.

(Qnnflash) — In a recent report, analysts at Morgan Stanley suggested that the introduction of Tesla’s Dojo supercomputer has the potential to contribute to a significant increase of $500 billion in the market capitalization of the electric vehicle manufacturer.

The shares of Tesla had a significant increase of over 6% in the early trading session on Monday morning. The upbeat assessment of the automaker’s supercomputing efforts by Morgan Stanley’s team contributed to this increase in value. According to the Morgan Stanley team, headed by Adam Jonas, a well-established analyst of Tesla, it is anticipated that substantial value might be generated through the possible utilization of Dojo, leading to the expansion of income streams via increased adoption of robotaxis and software services.

The analysts conducted a comparison between the potential of Dojo at Tesla and the factors that have similarly propelled Amazon Web Services, resulting in increased profitability for Amazon.

There has been a longstanding argument among investors regarding the classification of Tesla as either an automotive company or a technology company. The statement suggests that the authors hold the belief that both software and service revenue contribute significantly to the overall value. However, they emphasize that the primary driver of value is software and service revenue.

The Dojo supercomputer, which has been under development at Tesla for approximately five years, has been specifically engineered to facilitate the training of artificial intelligence (AI) systems in order to do intricate tasks. These tasks include providing support to Tesla’s driver-assistance system, Autopilot, as well as contributing to the advancement of its “Full Self-Driving” initiatives.

According to the analysts at Morgan Stanley, Dojo has the potential to access hitherto untapped areas that go beyond the conventional model of selling cars at a predetermined price.

According to the experts, it is anticipated that the forthcoming iteration of Tesla’s fully autonomous driving system, which is projected to be shown around the end of this year, together with Tesla’s upcoming AI Day, which is likely to take place in early 2024 but has not yet been officially announced, will be of considerable interest and merit close observation.

The value of Tesla’s shares has experienced a twofold increase since the commencement of the current year, while it remains significantly distant from the historical peak of $414.50 reached in November 2021. As of the market close on Friday, the carmaker with the highest market capitalization was valued at approximately $788.74 billion.

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