Morgan Stanley Robotics Yearbook (VII): Brain-Computer Interface as the Ultimate Physical Embodiment of AI

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(Source: NetEase Technology)

Brain-Computer Interface (BCI) technology is becoming the “ultimate physical embodiment” of artificial intelligence. It not only aims to address medical challenges but is also envisioned as a key bridge for human-AI symbiosis. With immense long-term market potential, it is attracting global capital and enterprises to accelerate their strategic investments.

According to Zhuifeng Trading Desk, the annual report by Morgan Stanley’s Adam Jonas analysis team released on December 22 indicated that the commercialization process of brain-computer interface (BCI) companies, represented by Elon Musk’s Neuralink, has significantly accelerated. As of September 2025, Neuralink had implanted devices in 12 human subjects, with cumulative usage exceeding 15,000 hours. Musk positions Neuralink as a core tool for addressing potential AI risks, enhancing human capabilities, and expanding consciousness.

This technological breakthrough is rapidly transitioning from vision to practical application. Morgan Stanley’s MedTech team estimates that the total addressable market (TAM) for brain-computer interface (BCI) implants in the U.S. alone could reach $80 billion by 2035, surging to $320 billion by 2045, primarily covering the treatment of various neurological disorders such as amyotrophic lateral sclerosis (ALS), stroke, spinal cord injury, epilepsy, and depression.

A global competitive landscape is taking shape. The report provides a detailed overview of leading startups such as Neuralink, Synchron, Precision Neuroscience, and Paradromics, and notes that China announced its brain-computer interface (BCI) technology development roadmap in August 2025, with the goal of achieving key technological breakthroughs by 2027 and becoming a global leader by 2030.

BCI: From Scientific Discovery to Commercial Competition

Research on brain-computer interfaces (BCIs) is not a novel concept. The report reviews its developmental trajectory: from the discovery of electrical activity in the human brain by German psychiatrist Hans Berger in 1924, to the genuine inception of BCI research in the 1970s. Key experimental breakthroughs emerged in the early 21st century, such as the demonstration by Professor Miguel Nicolelis of Duke University in 2003, where monkeys controlled robotic arms via BCIs, laying the foundation for subsequent research.

Over the past decade, technological advancements have propelled brain-computer interfaces (BCIs) toward clinical application in humans. Currently, the primary implantation technical pathways are categorized into several types: represented by Neuralink, throughRobotSurgical insertion of threads into the motor cortex; vascular implantation of electrode arrays, as exemplified by Synchron; and minimally invasive cortical surface or microneedle array technologies developed by Precision and Paradromics, respectively.

The report provides an in-depth analysis of Neuralink’s vision. Elon Musk has outlined four progressive objectives for the company: first, to alleviate human suffering (e.g., “Telepathy” implants assisting patients with paralysis); second, to enhance human capabilities (e.g., future “Blindsight” implants); third, to understand and expand consciousness; and ultimately, to achieve symbiosis between humans and AI/robots, thereby mitigating the existential risks potentially posed by artificial intelligence.

Within the hypothetical “Musk Economy” framework outlined by Morgan Stanley, Neuralink occupies a central position. By decoding complex neural signals, it integrates its hardware with robotics, AI computing, and data, ultimately enabling robotics directly controlled by the brain and achieving human-machine integration.

Market Size and Global Competition

Morgan Stanley’s quantitative forecasts provide a clear picture of market potential. Its medtech team, based on the U.S. patient population, expected penetration rates, and pricing models, has provided phased TAM forecasts. The early-stage market (through 2035) focuses on severe neurological disorders, while the mid- to long-term market (through 2045) is projected to grow substantially as technology matures and indications expand.

Global venture capital investment in neurotechnology (including BCI) surged to approximately $1.8 billion in 2025 (as of December 19), reflecting extremely high capital enthusiasm. The report lists several major BCI startups, comparing their technological approaches, clinical progress, and financing valuations. Among them, Neuralink leads with a valuation of $9 billion and over $1.3 billion in funding raised.

As a force that cannot be ignored, China’s national-level roadmap marks brain-computer interfaces (BCI) as one of the strategic arenas in global technological competition.

The Vast Battlefield of Embodied AI: From Logistics to Food Service, Automation Penetrates Every Industry

The latter half of the report expands its scope to “other forms” of embodied AI robots beyond BCI, illustrating how the wave of automation is sweeping across multiple industries.

In the warehousing and logistics sector, Amazon is a quintessential example of deepening automation penetration. The ratio of robots to employees has been optimized from 1:5 in 2017 to approximately 1:1.5 in 2025, with the total number of robots exceeding one million. According to an October 2025 report by The New York Times, Amazon plans to deploy around 40 next-generation robotic warehouses by 2027.

Food service is another sector with significant automation potential. The report estimates that the annual cost of supporting one full-time equivalent position in a 24-hour fast-food restaurant reaches approximately $167,000, with high labor costs and turnover rates driving the demand for automation. For instance, Miso Robotics’ “Flippy” french-fry robot, Hyphen’s food assembly line, and Sweetgreen’s “Infinite Kitchen” automated restaurant have all demonstrated effectiveness in enhancing efficiency and profit margins.

In household settings, specialized domestic robots (non-humanoid) have been developing for many years, such as the first Roomba robotic vacuum cleaner launched in 2002. These products primarily automate tasks like cleaning and monitoring, with their artificial intelligence focusing relatively more on path planning and object detection. Morgan Stanley predicts that by 2050, approximately 1.8 billion household robots will be in operation globally, averaging about 0.68 units per household. Among them, the penetration rate of household robots in the U.S. and Chinese markets is expected to reach 1.25 and 1.05 units per household, respectively, far exceeding the global average.

Furthermore, the report covers multiple vertical sectors, including quadruped robots, marine and underwater robots, agricultural automation, construction and mining automation, last-mile unmanned delivery, hotel service robots, and surgical robots, providing corresponding market size forecasts and analyses of key players.

Expected Explosive Growth of Professional Service Robots

Morgan Stanley projects that by 2050, the number of professional service robots in operation globally (excluding humanoid robots, drones, autonomous vehicles, and industrial robots) will reach 840 million units, significantly higher than the current base, indicating a trend of rapid growth. In terms of corresponding hardware sales revenue, it could reach nearly $200 billion by 2040 under the baseline scenario, and approach $300 billion under the optimistic scenario.

The wave of embodied AI, spearheaded by Brain-Computer Interfaces (BCI) and built upon a broad foundation of specialized robots, is shifting comprehensively from technological exploration to commercialization and large-scale application. This transition is redefining the boundaries of productivity and human capability, while outlining a vast, multi-layered market landscape for investors.