TLDR:
- Tesla stock fell in premarket trading Monday while pursuing a third consecutive weekly gain
- Despite Q1 profits dropping 66% year-over-year, the stock jumped 18.1% post-earnings
- Tesla plans to launch a self-driving taxi service in Austin by June 2025
- Elon Musk believes Tesla could eventually be worth more than the next five largest companies combined
- Tesla vehicles were spotted driving themselves off the assembly line at the Austin plant
Tesla stock dipped 0.5% in early Monday trading as the electric vehicle maker worked toward its third straight weekly gain. This follows last week’s modest 0.8% rise and the previous week’s impressive 18.1% jump after the company’s first-quarter earnings report.
The stock’s recent performance is noteworthy because Tesla’s Q1 financial results weren’t particularly strong. The company reported an operating profit of $399 million, representing a 66% drop compared to the same period last year.
This figure fell well short of Wall Street’s expectations, which had projected around $900 million in operating profit.
Normally, such disappointing earnings would send a stock tumbling. But Tesla shares climbed instead, largely because the company maintained its timeline for launching a robotaxi service.
During the earnings call, Tesla executives confirmed they’re still on track to unveil a self-driving taxi service in June. This reaffirmed timeline bolstered investor confidence.
Many shareholders see autonomous driving technology as the key to unlocking Tesla’s next phase of growth.
Robotaxi Deadline Approaching
Tesla appears fully committed to the June deadline. On May 1, the official Tesla AI account on X posted a reminder that June 1 was just 31 days away.
While the post didn’t explicitly mention self-driving vehicles, the June timeline has been a major focus for Tesla analysts and investors for months.
Investors got a small preview of Tesla’s self-driving capabilities over the weekend. Fox News host Lara Trump toured the company’s Austin, Texas manufacturing facility.
During her visit, she observed Tesla vehicles driving themselves off the assembly line without human intervention. This demonstration offered a glimpse of the technology’s current capabilities.
It remains unclear how challenging the transition will be from autonomous driving in a controlled factory environment to navigating the public streets of Austin. However, Tesla leadership appears confident they’re ready to make this leap.
Musk’s Bold Valuation Claims
Despite Tesla’s recent stock struggles, CEO Elon Musk continues to make stunning claims about the company’s future valuation. The stock has fallen approximately 29% year-to-date, though it remains up about 55% over the past 12 months.
Musk has repeatedly told analysts he sees “a path for Tesla being the most valuable company in the world by far.” He believes Tesla could eventually be worth more than the next five largest companies combined.
Those five companies—Apple, Microsoft, Nvidia, Amazon, and Alphabet—have a combined market value of nearly $15 trillion. If Tesla reached this valuation, it would represent a 17-fold increase from its current market cap of $879 billion.
Such growth would mean $50,000 invested in Tesla stock today could potentially be worth $850,000 in the future.
Musk’s confidence in this ambitious target stems “overwhelmingly” from two developing technologies: autonomous vehicles and humanoid robots.
Challenging First Quarter
Tesla’s Q1 2025 results revealed several challenges facing the company. Vehicle deliveries declined 13% to 336,681 units, marking the lowest quarterly total in three years.
Revenue fell 9% to $19.3 billion, while the company’s operating margin contracted to a six-year low. Non-GAAP net income dropped 40% to $0.27 per share, missing analyst expectations.
The company also withheld future guidance, citing uncertainty created by shifting U.S. trade policies.
Despite these concerning financial trends, investors remain focused on Tesla’s autonomous technology plans. Musk reaffirmed during the earnings call that the company would launch its robotaxi service in Austin by June.
He also stated that Tesla would have thousands of autonomous robots working in its factories this year.
The Robotaxi Race
Tesla faces stiff competition in the autonomous ride-sharing space. Alphabet’s Waymo currently leads the market, providing more than 250,000 robotaxi rides weekly across several major U.S. cities.
Waymo is steadily expanding to new locations, with Atlanta, Miami, and Washington, D.C. next on its list.
However, Tesla has two potential advantages in this race. First, the company has more camera-equipped vehicles collecting video data to train its AI models. Second, Tesla relies solely on computer vision rather than the expensive combination of cameras, radar, and lidar used by Waymo.
This strategy could make Tesla’s approach both less costly and more scalable. Waymo reportedly spends $100,000 on equipment alone for each of its vehicles, while Tesla believes it can build Cybercabs for less than $30,000.
Musk expressed supreme confidence in Tesla’s position, telling analysts, “I don’t see anyone being able to compete with Tesla at present.” He predicts Tesla will capture 99% market share in autonomous ride-sharing.
According to Morgan Stanley analyst Adam Jonas, Tesla could have 900,000 robotaxis operating by 2035, each generating approximately $93,800 in annual revenue. This would translate to total revenue exceeding $84 billion from the robotaxi business alone.
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