Should Tesla Be Kicked Out Of Magnificent 7?

Should Tesla Be Kicked Out Of Magnificent 7?

Douglas A. McIntyre

Wed, September 2, 2026 at 6:43 PM GMT+3 3 min read

Quick Read

• Tesla cratered 22% while Apple, Nvidia, and Amazon each beat the S&P 500, exposing it as the Mag7's weakest and most misplaced member.

• Tesla earned $28.4 billion last quarter, with $20.5 billion from car sales, cementing its identity as an automaker, not a tech company.

• Tesla's Full Self-Driving still requires driver supervision, its Robotaxi is only approved for testing, and the Optimus robot program remains in its infancy.

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The Mag7 has performed poorly this year. Only three of its companies have outperformed the S&P 500. These are Apple (NASDAQ: AAPL), up 17%; Nvidia (NASDAQ: NVDA), up 16%; and Amazon (NASDAQ: AMZN), up 15%. One stock has cratered. Tesla (NASDAQ: TSLA) is down 22%. And it is really a car and not a tech company. It shouldn't be in the group. The group should be the Mag6

It is easy to argue that the rest of the companies are pure tech plays, each deep into building its own version of AI. Each has investments today and larger investments tomorrow into AI data centers. Across the group, including OpenAI and Anthropic, the construction figure is nearing $1 trillion next year and is expected to rise for the foreseeable future.

Tesla makes cars. If people want to invest in Elon Musk's foray into AI, they should invest in SpaceX (NASDAQ: SPCX), which has its xAI division.

During the most recently reported quarter, Tesla produced over 450,000 vehicles and delivered over 480,000. Its revenue was $28.4 billion. Of that, $20.5 billion was automotive. $3.1 billion came from energy generation and storage.

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Tesla would like to trade as an AI company, but little evidence suggests it is one. Its autonomous car business, using its own cars, has not been approved for full autonomy. Its "Full Self-Driving" system still requires driver supervision.

Tesla's Robotaxi has been approved for testing in a few cities. Whether its safety features will match public expectations is uncertain. Local authorities will also need to approve it.

The Optimus robot program is in its infancy. Elon Musk says hundreds of millions of these will be operating around the world in ten years. Many robotics experts have questioned that.

Tesla isn't a tech company and should not be part of the Mag7.

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