Elon Musk has always thrived on bold claims and the contradictions that follow. On July 23, he joined Tesla’s second-quarter earnings call, the standard ritual in which executives talk up their company’s performance and future. Musk was in full visionary mode.
That day, he painted a glowing picture of the future of Dojo, Tesla’s ultra-ambitious, custom-built supercomputer designed to train the neural networks for Full Self-Driving (FSD) and Tesla’s humanoid robot, Optimus. He called the next generation of Dojo “really spectacular,” spoke of a new “AI factory” with “a lot of potential,” and laid out plans for Dojo 3.
His tone and detail suggested Dojo was one of Tesla’s most important projects, an active, thriving pillar of the company’s identity as an AI leader.
Less than a month later, Bloomberg dropped a bombshell: citing sources familiar with the matter, the outlet reported that Tesla had terminated its Dojo project entirely. Peter Bannon, the project’s leader, was leaving the company, roughly 20 Dojo team members had recently departed for a new startup called DensityAI, and the remaining staff were being reassigned to other projects.
A Complete About-Face
The speed of the reversal is hard to overstate. In the space of weeks, Tesla appears to have gone from publicly championing Dojo’s “spectacular” potential to quietly dismantling the team. If Bloomberg’s reporting is confirmed, it would mark the end of a program Musk once pitched as central to Tesla’s technological edge.
The Dojo project had already endured turbulence. It was widely seen as Tesla’s attempt to reduce reliance on Nvidia’s GPUs by building its own custom chips and training hardware. It was an expensive and technically risky strategy in a market dominated by chip giants. Losing talent to DensityAI, including key leaders, suggests mounting internal headwinds long before Bloomberg’s scoop.
On the July call, Musk fielded a question about whether his AI startup, xAI, might use Dojo. His answer was brimming with specifics and confidence.
“Dojo 2. We expect Dojo 2 to be operating at scale within the next year. At about 100 kh, 100 equivalents,” Musk said.
He went on: “And then AI Five, which is also really spectacular. I don’t use those words lightly. We hope to have the AI factory in production towards the end of next year. But that has a lot of potential.”
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