What are the highlights of the humanoid robot market in 2026? Morgan Stanley: Short-term speculation will continue, Tesla is the focus, the U.S. government and major companies will get involved, but the gap between China and the U.S. is widening

Author: Ye Huiwen

Source: Hard AI

On December 19, Morgan Stanley pointed out in its latest research report that while the market for humanoid robots will continue to heat up in 2026, investors should be wary of the significant gap between "dancing robots" and robots with scalable practical value.

The firm believes that short-term market speculation will continue, but the industry may soon face a correction due to the difficulties in developing physical AI, manufacturing obstacles, and the reshuffling of startups.

In terms of specific market catalysts, the release of Tesla's Optimus Gen 3 and the potential announcement by tech giants to officially enter the robotics field will be key highlights in early 2026. According to Politico, the U.S. government is planning to introduce new policies to accelerate the development of the domestic robotics industry, with U.S. Secretary of Commerce Gina Raimondo and the Trump administration reportedly set to "go all out" to support this sector. Potential executive orders may include not only tax subsidies but also aim to incentivize private investment through various means to address competition.

Despite the U.S. attempting to strengthen its policy efforts, Morgan Stanley emphasizes that the gap between China and the U.S. in this field is widening at an accelerating pace. With an almost undisputed manufacturing advantage, China continues to solidify its leading position, with "embodied intelligence" listed as one of the six breakthrough industries in China's 14th Five-Year Plan recommendations. Nevertheless, Li Chao, a spokesperson for China's National Development and Reform Commission, has warned of the risk of a "bubble" in the industry, pointing out that while capital is flooding in, verified real application cases remain scarce.

In terms of market performance, the Humanoid 100 index compiled by Morgan Stanley has risen by 25% since its establishment in February 2025, outperforming the S&P 500 and MSCI Europe and China indices. As global robotics companies transition from the laboratory to the real world, the differentiation between winners and laggards will become increasingly apparent, with capital and talent concentrating in companies that demonstrate the strongest internal AI capabilities and manufacturing expertise.

Continued Short-term Speculation and the Game of Technical Realities

Morgan Stanley analysts warn that while enthusiasm for humanoid robots will surge in waves in 2026, investors should focus on the bigger picture.

In the short term, the release of Tesla's Optimus Gen 3, breakthroughs in hardware and AI technology, and major tech companies' statements regarding physical AI will further boost market sentiment. However, the industry may subsequently experience a "reset," primarily due to the market gradually recognizing the challenges of developing physical AI models, manufacturing hurdles, and the pressures faced by startups.

Regarding technological maturity, the firm specifically advises investors to remain cautious about "autonomy." Achieving full autonomy for humanoid robots is very challenging; if a demonstration is not explicitly labeled as "autonomous," investors should assume it is remotely operated. Using remote operation for data collection and training is a necessary path toward autonomous robots, but this does not necessarily signal danger; it simply indicates that 2026 is not yet the year to assume robots possess complete autonomous capabilities

Tech Giants Entering the Arena and Shifts in U.S. Policy

2026 will not only be a battleground for startups but also a key year for tech giants vying for new growth points.

Morgan Stanley predicts that at least one large tech company or major AI lab (such as Meta, Google, Apple, Amazon, OpenAI, etc.) will officially announce plans to build robots. As these companies seek new Total Addressable Markets (TAM) to support their AI-driven high valuations, entering the robotics hardware sector is likely to become a significant event.

On the policy front, according to Politico, Lutnick and the current U.S. government are clearly seeking to accelerate the development of the U.S. robotics industry through potential executive orders. Regardless of whether the final policy outcome is tax subsidies, government procurement, or regulatory changes, the U.S. government is expected to signal support for the domestic robotics industry through various channels.

This is similar to actions taken in the past year in the rare earth and drone sectors, aimed at incentivizing private investment and technological development.

China Consolidating Manufacturing Advantages and Regulatory Warnings

Despite increased policy support in the U.S., Morgan Stanley points out that China is continuing to consolidate its leading position with its core advantage—manufacturing. Currently, almost every major Chinese automotive and consumer electronics company is linked to humanoid robots or AI-powered robots in some way.

At the same time, Chinese regulators have also noticed signs of overheating in the industry.

In response to media questions about the "cooling" of the industry, National Development and Reform Commission spokesperson Li Chao stated that for all emerging industries, including the humanoid robotics industry, it is necessary to balance the speed of development with potential "bubbles." Currently, there are over 150 companies in this field, and although there are few actual application cases, significant investments are pouring in. Further guidelines are expected to be issued in the upcoming 14th Five-Year Plan.

Financing Dynamics and Latest Developments of Companies

The primary market remains active from late 2025 to early 2026.

According to Bloomberg, AI robotics startup Physical Intelligence raised $600 million at a valuation of $5.6 billion, led by CapitalG, a subsidiary of Alphabet. Additionally, Reuters reported that Skild AI is in talks with SoftBank and Nvidia to seek over $1 billion in financing at a valuation of approximately $14 billion. Furthermore, Unitree's competitor Deep Robotics has also raised about $70 million.

On the product front, major manufacturers are making frequent moves. Tesla showcased the improved Optimus hardware, with videos showing it running smoothly in the lab and featuring articulated toes, laying the groundwork for the Gen 3 release in early 2026. Midea Group launched the "super humanoid robot" MIRO U, which has six arms and aims to increase factory output by about 30% through multitasking. Meanwhile, Norwegian company 1X announced a deal with EQT Ventures to deliver 10,000 NEO humanoid robots to factories and warehouses, marking a significant expansion of its application scenarios from home use to industrial fields

Long-term Market Outlook

Morgan Stanley maintains a strong long-term market expectation for the industry. According to the bank's global robotics model forecast, by 2050, the annual revenue of the global humanoid robot market could reach $7.5 trillion. Assuming a replacement cycle of 6 years and a decline in average selling price as the supply chain matures, it is expected that by 2036, approximately 24.4 million humanoid robots will be adopted globally, and this number will reach 1 billion by 2050.

In high-income countries, the average selling price of humanoid robots is expected to drop from $200,000 in 2024 to about $75,000 by 2050; while in middle and low-income countries, benefiting from mass production and localized supply chains, the average selling price is expected to be even lower, decreasing from the current approximately $50,000 to around $21,000 by 2050, which will greatly promote global adoption and application.