How we know: NVIDIA's glossary definition; company releases and filings; news reports on the deployments linked below. Every fact is listed in Sources.
What is physical AI? A plain-English guide for business owners
Physical AI is the name for AI that runs machines in the real world: robots, tractors, mine trucks, drones and driverless cars. Here is what it means, where it is working, and what it has cost when it didn't.
The short answer
The term is pushed hardest by NVIDIA, which sells the chips and software behind many of these machines, so read its definition with that in mind. NVIDIA says physical AI "enables autonomous machines, such as robots in factories and robotaxis, to perceive, understand, and perform complex actions in the physical world." [1]
NVIDIA draws the line this way: generative AI "creates content such as text, images, and code, while physical AI helps autonomous machines perceive, reason about, and act in the real world." [1] A chatbot that gets something wrong produces a bad answer. A machine that gets something wrong can damage stock, equipment or people.
NVIDIA also notes a limit that matters for buyers: these systems are often trained in simulation, and "performance in simulation may not fully predict behavior after deployment." [1]
Where it is working today
Factories. BMW tested a humanoid robot from Figure at its Spartanburg, South Carolina plant in 2024. BMW says the robot "successfully inserted" sheet-metal parts during a "trial run lasting several weeks." BMW published no measured speed or accuracy results from the trial. [2] By June 2026, BMW said a Figure 02 robot had "supported the production of more than 30,000 BMW X3 vehicles over ten months." That is a company claim. [3] See our cases on the 2024 test and the Figure 03 project.
Warehouses. Amazon said in July 2025 that it had deployed its one-millionth robot, and that a new AI model, DeepFleet, would make its robot fleet's travel 10% more efficient. That is a vendor claim. [4] Amazon says Vulcan can pick about 75% of the items it stocks, TechCrunch reported. [5] See Amazon's robot fleet. Logistics firm GXO has run pilots with three humanoid makers, Agility, Apptronik and Reflex, Business Insider reported. [6] See GXO's humanoid pilots.
Farms. John Deere showed new autonomous machines at CES 2025 and did not disclose prices. [7] Deere said fuel costs, maintenance costs and maintenance downtime for its electric 5ML orchard tractor are "all reduced by about half," DTN reported. That is a vendor claim. [8] See Deere's autonomy push.
Mines. At Roy Hill in Western Australia, all 78 haul trucks have been converted for autonomy, with 60 allocated to autonomous operation, according to automation supplier Epiroc. The final fleet is 54 Caterpillar 793F and 24 Hitachi EH5000 trucks. The total cost was not disclosed. [9] See Roy Hill's autonomous fleet.
Delivery. Zipline and Walmart launched drone delivery in Mesquite, Texas, for households within 2 miles of the store, with more than 65,000 items and delivery "in 30 minutes or less," FreightWaves reported. [10] See Zipline in Mesquite. Sidewalk-robot maker Serve Robotics said it planned to have 2,000 robots across the U.S. by the end of 2025. That is a vendor plan. [11] See Serve in Miami.
When it doesn't pay
Robots don't guarantee a return. Kroger said in November 2025 it would close three of its automated fulfillment centers, in Wisconsin, Maryland and Florida, and expected about $2.6 billion in impairment and related charges. [12] See Kroger's closures.
Questions to ask before you buy
- What is the proof outside a demo? BMW published no measured speed or accuracy results from its 2024 trial. [2] Ask any vendor for results from a site like yours.
- What does it cost all-in? Deere did not publish prices, and the total cost at Roy Hill was not disclosed. [7][9]
- What happens when it meets something new? NVIDIA itself warns simulation results may not carry over. [1]
- Is the volume there? Kroger's charges show what happens when it isn't. [12]
For the software-only side of the same trend, see What is agentic AI? For driverless cars, see What is a robotaxi?
Sources
- NVIDIA, “What Is Physical AI?” glossary (undated; accessed Oct. 28, 2026). nvidia.com
- BMW Group, “Successful test of humanoid robots at BMW Group Plant Spartanburg,” Aug. 6, 2024. press.bmwgroup.com
- BMW Group, “BMW Group advances the use of Physical AI in production with Figure 03 project in Spartanburg,” June 25, 2026. press.bmwgroup.com
- Amazon, “Amazon launches a new AI foundation model to power its robotic fleet and deploys its 1 millionth robot,” July 1, 2025. aboutamazon.com
- Kyle Wiggers, TechCrunch, “Amazon debuts a warehouse robot with a sense of 'touch',” May 7, 2025. techcrunch.com
- Madeline Stone, Business Insider, “GXO Partners With Top Robotics Firms to Bring Humanoids to Warehouses,” April 8, 2025. businessinsider.com
- John Deere, “John Deere Reveals New Autonomous Machines & Technology at CES 2025,” PR Newswire, Jan. 6, 2025. prnewswire.com
- Dan Miller, DTN/Progressive Farmer, “Deere Loads 2nd-Generation Autonomy, Battery Tech Into New 5ML Orchard Tractor,” Jan. 28, 2025. dtnpf.com
- Epiroc, “Epiroc and Hancock Iron Ore reach milestone as Roy Hill becomes world's largest fully agnostic autonomous mine,” Oct. 24, 2025. epirocgroup.com
- Jack Daleo, FreightWaves, “Zipline drone delivery takes flight in Texas with Walmart – for free,” April 9, 2025. freightwaves.com
- Serve Robotics, “Serve Robotics Expands to Miami Metro, Offering Autonomous Delivery for Shake Shack and Mister O1,” GlobeNewswire, Feb. 19, 2025. globenewswire.com
- Kroger, “Kroger Evolves eCommerce Offerings to Improve the Customer Experience, Drive Profitable Sales Growth,” Nov. 18, 2025. ir.kroger.com
© 2026 Real World Wire. Written October 28, 2026.