Seven Sources of Physical AI Capability Formation A new arXiv paper (2609.09627v1) identifies seven non-exclusive sources of Physical AI capability formation: Recorded-Experience, Predictive-Modeling, Evaluative-Interaction, Surrogate-Environment, Mechanism-Grounded, Embodied-Coupling, and Evolution-Driven Formation. Using reconstructive induction with theoretical saturation, the authors traced a research matrix to primary studies and found that all 49 evidence records, within the scope fixed as of September 4, 2026, were explainable by the seven sources individually or in combination, with no R1-R3 challenge producing an irreducible eighth source. The framework distinguishes similarity in observed capability from similarity in how it was formed, supporting analysis of explanation, transfer, replication, dependencies, governance evidence, and geoeconomic foundations. arXiv:2609.09627v1 Announce Type: new Abstract: Capabilities relevant to Physical AI can arise from materially different formation histories, yet existing taxonomies organized by morphology, architecture, learning algorithm, task, or domain do not directly answer what gives rise to a capability. We define a capability-formation source as a factor materially contributing to capability formation, distinct from components or construction steps. We identify seven non-exclusive sources: Recorded-Experience RE , Predictive-Modeling PM , Evaluative-Interaction EI , Surrogate-Environment SE , Mechanism-Grounded MG , Embodied-Coupling EC , and Evolution-Driven ED Formation. Using reconstructive induction with theoretical saturation, we traced a research matrix to primary studies, deduplicated the literature, set coding rules, and conducted three rounds of maximum-difference and negative-case sampling. Challenges included curriculum and self-supervised learning, active inference, open-ended and developmental learning, planning and search, neuro-symbolic architectures, digital twins, generative physical world models, and morphology-control co-design. Within the scope and criteria fixed as of September 4, 2026, all 49 evidence records were explainable by the seven sources individually or in combination. No R1-R3 challenge produced an irreducible eighth source, and R3 required no new core definition or substantive boundary rule. We therefore claim theoretical saturation within the stated scope, not logical completeness or exhaustive future coverage. The framework distinguishes similarity in observed capability from similarity in how it was formed, supporting analysis of explanation, transfer, replication, dependencies, governance evidence, and geoeconomic foundations.