TLDR
- Tesla reports Q2 earnings Wednesday with Wall Street expecting 39 cents per share on $22.1 billion in sales, both down from last year
- Options markets predict Tesla stock will move about 7% up or down following the earnings call, potentially reaching $350 or dropping to $307
- Vehicle deliveries fell 13.5% year-over-year to 384,000 cars in Q2, pressuring both sales and earnings expectations
- Analysts want updates on AI-trained robotaxis, humanoid robots, and the delayed lower-priced vehicle model
- Tesla stock is down 18% year-to-date but up 38% over the past 12 months, trading around $329 Monday
Tesla earnings calls have become legendary for their unpredictability. Wednesday’s second-quarter report promises to continue that tradition.
The electric vehicle maker faces a challenging quarter with declining sales and earnings. Wall Street expects earnings per share of 39 cents on revenue of $22.1 billion, according to FactSet estimates.
Those numbers represent a steep drop from last year’s second quarter. Tesla reported 52 cents per share on $25.5 billion in sales during the same period in 2024.
Vehicle deliveries tell the story of Tesla’s struggles. The company sold 384,000 cars in Q2, down 13.5% from the previous year.
Tesla shares closed Monday at $328.49, down 0.4% for the day. The stock has fallen 18% year-to-date but remains up 38% over the past 12 months.
Options traders expect fireworks after the earnings release. Current pricing suggests Tesla stock could swing 7% in either direction, potentially reaching $350 or dropping to $307.
Policy Changes Create New Headwinds
President Trump’s elimination of the federal EV purchase tax credit adds pressure to Tesla’s sales outlook. Baird analyst Ben Kallo sees this policy change as a risk to full-year earnings estimates.
Congress also revoked California’s waiver to regulate air emissions. This move threatens Tesla’s zero-emission vehicle credit sales, which generated $595 million in the first quarter.
Wells Fargo analyst Colin Langan expects ZEV credit sales to decline materially in the second quarter. He rates Tesla shares a Sell with a $120 price target.
Tariffs present another challenge for Tesla’s energy business. Cantor Fitzgerald analyst Andres Sheppard expects Tesla to lower growth expectations for energy storage.
The delayed launch of Tesla’s lower-priced vehicle adds to investor concerns. The model was originally scheduled for unveiling in the first half of 2025.
Focus Shifts to Future Technology
Investors will listen closely for updates on Tesla’s robotaxi program. The company launched the service in Austin, Texas, in June.
Tesla also plans to start selling humanoid robots in large volumes by 2026. Both analysts expect management to provide updates on these AI initiatives.
RBC analyst Tom Narayan maintains a Buy rating with a $319 target. He still believes the lower-priced car will arrive and boost sales later this year.
Elon Musk remains central to Tesla’s story and valuation. The CEO left Washington in May and has been publicly feuding with President Trump.
Tesla trades at roughly 180 times estimated 2025 earnings, reflecting investors’ faith in Musk’s vision. His presence and mindset during the earnings call will be closely watched.
The stock has moved an average of 11% following the previous four earnings reports. It rose three times and fell once during that span.
Tesla shares rose 5.4% after the first-quarter report when Musk announced his departure from the Trump administration. They gained nearly 3% following January’s fourth-quarter results.
Recent quarters have seen more dramatic swings. Tesla surged nearly 22% after one earnings call and dropped 12.3% after another.
Analyst ratings remain mixed on Tesla stock. Eight analysts call it a “buy” compared with five “hold” and four “sell” ratings, according to Visible Alpha data.
The average analyst price target sits at $301, about 8% below Monday’s closing price. This suggests some skepticism about Tesla’s near-term prospects.
Tesla’s Q2 earnings call is scheduled for Wednesday after market close, with the company expected to provide guidance on vehicle deliveries, new model timelines, and progress on autonomous driving technology.
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