How to Invest in the Humanoid
Robot Revolution

Humanoid robots are rapidly moving from science fiction to the real world. While the technology may have once seemed futuristic, it's now becoming a reality, with numerous companies developing prototypes and aiming for mass production in the near future.

For investors, the rise of humanoid robots could present some compelling opportunities in the years ahead given their potential use cases. Here’s a look at some industry growth projections, and how to gain exposure to this exciting area of technology.

A $7 Trillion Industry by 2050?

While the humanoid robotics industry is still nascent today, it’s expected to see prolific growth in the decades ahead. According to analysts at Morgan Stanley - who predict that there will be 13 million humanoids in action by 2035, rising to one billion by 2050¹ - the market could be worth $5 trillion by the mid-point of the century. Analysts at Citi Global Insights believe that it could be even bigger. Their view is that the industry could be worth up to $7 trillion by 2050 given the technology’s potential in home services and industrial settings² . Note that analysts at Goldman Sachs have said that in a “blue-sky” scenario - where innovation unfolds rapidly and demand soars - humanoid robots could become the next “must-have” device³ . In other words, demand could rival that of smartphones or electric vehicles (EVs).

It’s worth pointing out that Tesla CEO Elon Musk has said that he believes that by 2040, there are likely to be more humanoids on earth than humans. Musk is hoping that in the future, Tesla will be able to sell its “Optimus” robots for $20,000 to $30,000, which is less than the cost of a car⁴.

Nvidia CEO Jensen Huang has also spoken about the potential size of the market. He sees robotics as the next chapter of artificial intelligence (AI) and believes that the market for humanoids is going to be immense.

So clearly, the consensus view is that the industry has significant potential. In the years and decades ahead, we can expect to see some exciting developments.

Many Potential Applications

As for why the market for humanoid robots is projected to be so large, it comes down to the fact that there are potential applications in many different industries. Looking ahead, humanoids could be used for:

• Household assistance: Robots could serve as personal assistants, cooking meals, cleaning the house, doing the laundry, and mowing the lawn.

• Healthcare and elderly care: Humanoids could assist with patient monitoring, rehabilitation and physical therapy, and companionship.

• Manufacturing and logistics: Robots could be deployed in warehouses and factories to operate machinery, work on assembly lines, transport goods, and perform quality control checks.

• Retail and hospitality: In the retail space robots could be used to stock shelves and help customers while in the hospitality industry they could be used to take orders, serve food, and assist with check-in.

• Security: Humanoid robots can patrol continuously and with unwavering attention, so they could be a highly effective first line of defense in security and surveillance.

Note that a key advantage of these robots is their ability to mimic human form and function. This means that there is no need to redesign factories, warehouses, hospitals, or retail spaces for them to operate; they should be able to integrate directly into our world without major infrastructure changes.

Barriers to Adoption

Of course, while the potential applications are extensive, there are plenty of barriers to adoption that could hamper the growth of the industry. These include:

• Cost: Humanoid robots are expensive to produce today, so costs will have to come down for the technology to be commercially viable.

• Public perception: People may be apprehensive about sharing spaces with robots that look and move like humans.

• Battery life: Battery life for fully mobile humanoids remains short so this will need to be improved.

• Safety: Developers will need to prove that robots are safe to operate in environments with humans.

• Production constraints: Ramping up production may be a challenge for companies looking to deploy the technology.

Investing in Humanoid Robots

When it comes to investing in humanoid robots, a good place to start is to understand the supply chain. It can be broken down into three main areas: companies that provide technology for the brains of the robots, companies that provide solutions for the bodies of the robots, and companies that put all the technology together and produce the finished product.

The brain of a humanoid robot is responsible for its intelligence, perception, and coordination. Technology required here includes:

• Software and artificial intelligence (AI) technology: To operate effectively, robots require operating systems, large language models (LLMs) for understanding commands, and software for learning and decision-making.

• Semiconductors and processors: This hardware provides the computing power needed for all the robot's systems to run efficiently.

The body of the robot includes all the physical components that enable movement and interaction with the world. Here, key components include:

• Actuators and motors: These enable robots to convert energy into physical motion, allowing them to perform tasks like walking, grasping objects, and lifting heavy loads.

• Sensors and cameras: These help robots perceive their environment, enabling them to navigate, identify objects, and interact safely with the world around them.

• Power systems: Batteries and the battery management systems are required to provide a stable energy supply to all the robot's modules.

• Materials: With a humanoid robot, the physical framework, or “exoskeleton,” is typically made of lightweight, durable materials like aluminum alloys or carbon fiber.

Companies that bring all the different components and technologies from the brain and body categories together to build and assemble the final product are often referred to as “integrators.” These businesses specialize in turning individual parts into fully functional, marketable robots.

So ultimately, the supply chain is made up of a wide range of companies. Therefore, there are many ways to invest in humanoid robots. Interestingly, analysts at Goldman Sachs have said that the best investment opportunities for now could lie in component makers that form the supply chain3 . In the near term, these companies may be better placed for success than the integrators are given the significant costs associated with developing and manufacturing robots at scale.

Five Humanoid Robot Stocks to Watch

Zooming in on individual stocks, some to keep an eye on include:

• Tesla (4.98%*): In recent years, EV powerhouse Tesla has been developing a general-purpose humanoid called “Optimus.” This is a core part of the company’s vision to become a leader in AI and robotics, and CEO Elon Musk is aiming to produce millions of units annually in the years ahead.

• XPeng (2.67%*): XPeng, a Chinese EV manufacturer, has made a significant push into the humanoid robotics space with a product called “IRON.” The company is aiming to leverage the same full-stack AI and autonomous driving technology used in its vehicles to create a versatile robot capable of both industrial and domestic applications.

• Rainbow Robotics (4.06%*): Rainbow Robotics is a South Korean technological mechatronics company that specializes in robotic system engineering technology. It has developed a humanoid platform known as HUBO2, which has been sold to world-class research institutes such as MIT and Google.

• Nvidia (4.08%*): A leading provider of AI chips and accelerated computing hardware, Nvidia is likely to play a major role in the robotics revolution. Recently, it has developed several products for humanoids including Jetson Thor, a powerful AI module that acts as the brain for robots, and Isaac GR00T, a comprehensive platform designed to accelerate the development of the technology.

• Ouster (4.37%*): Ouster is an American technology company that designs and manufactures high-resolution digital LiDAR sensors. Today, its technology is used in a wide range of robotics products including autonomous mobile robots (AMRs) for warehouse automation, delivery robots, and industrial robotics for navigation and perception.

While all these companies have potential, investors need to remember that the humanoid robotics industry is still very much in its infancy today. This means that it’s still too early to tell which businesses will have success in the long run. Given the competitive landscape, it could be sensible to take a diversified investment approach to this industry. By investing in a thematic product, one can potentially mitigate company-specific risk while still gaining exposure to the potential long-term growth of the overall industry.

*Weightings in the Themes Humanoid Robotics ETF as of September 15, 2025.

Introducing the Themes Humanoid Robotics ETF

Those interested in gaining diversified exposure to the humanoid robotics industry may wish to take a look at the Themes Humanoid Robotics ETF (BOTT). This seeks to track the Solactive Global Humanoid Robotics Index (SOLGHRBN), which identifies the largest 30 companies with a positive total return over the past 12 months in the following industry groups:

• Factory automation equipment

• General/processor/specialized semiconductors

• Industrial machine parts and support equipment

• Programmable logic and ASIC semiconductors

With this product, investors can gain access to dozens of companies in the robotics ecosystem. The fund’s expense ratio is 0.35%, making it one of the cheapest humanoid robot ETFs in the market.

Please see fund webpage for important disclosures and information about the fund.

Footnotes:

¹MorganStanley, Humanoids: A $5 Trillion Market, as of May 14, 2025 

²Yahoo Finance!, Humanoid robots could create a $7 trillion market in the next 25 years: Citi analysts, as of December 5, 2024

³Goldman Sachs, The global market for humanoid robots could reach $38 billion by 2035, as of February 27, 2024

⁴YouTube, CNBS Televesion, Tesla CEO Elon Musk on Optimus robot: This will be the biggest product ever of any kind, as of October 11, 2024