Tesla earnings live updates: Elon Musk's EV maker misses Wall Street's estimates, stock whipsaws after hours

"Everybody knew it was going to be messy, right? That's no secret," says Craig Irwin, Managing Director and Senior Research Analyst at Roth Capital Partners.

"Their gross margins of 16.2% were just a scratch below 16.5%, or adjusted auto gross margins of 12.5% below 13.1% — that's actually pretty solid given the size of the revenue miss, they missed by basically $2 billion," Irwin added. "They were down 13% year over year in deliveries — that's a big miss. So to have margins still resilient is actually pretty good."

RBC Capital analyst Tom Narayan says in an analyst note following the earnings release that the follow-up earnings call at 5:30 p.m. ET could be the "more relevant" update on the business.

Thomas Monteiro, senior analyst at Investing.com, tells BI that "against the backdrop of catastrophic expectations," Tesla's numbers are good news to investors.

"It's as if numbers show that even at the worst moment, Elon and the team's operation can still bring a robust $19.3 billion in revenue," Monteiro says, adding that its total revenue somewhat makes up for "the huge drop in auto revenue."

Monteiro says the company has room for "significant improvement on the financial side," but says the upcoming cheaper model and Robotaxi represent near-term upside.

Tesla shared photos of its soon-to-open new drive-in diner in West Hollywood.

Business Insider recently visited the restaurant's construction site, where the looming movie screens can already be seen from blocks away.

Tesla said there's growing "uncertainty" in automotive and energy markets as trade policy quickly evolves and negatively affects Tesla's cost structure, as well as the global supply chain.

"This dynamic, along with changing political sentiment, could have a meaningful impact on demand for our products in the near-term," Tesla said in the earnings release.

(One way to read that part? Backlash related to Elon Musk's DOGE work.)

The company also said it's committed to growing its business model to deliver autonomous robots as it grapples with headwinds.

This is notable. In Tesla's Q4 2024 release, the company said it expected "the vehicle business to return to growth in 2025."

Projections for a return to growth in its latest release are missing.

Now, Tesla says that despite making "prudent investments" to set up its vehicle and energy business for growth, "the rate of growth this year will depend on a variety of factors," such as the rate of acceleration of autonomy and production ramps.

"It is difficult to measure the impacts of shifting global trade policy on the automotive and energy supply chains, our cost structure and demand for durable goods and related services," the company said in the release.

"Plans for new vehicles, including more affordable models, remain on track for start of production in the first half of 2025," the company said in its earnings release, echoing language it's previously used in recent quarters.

But this language calling more affordable options "as critical as ever" is new:

"During the switchover, we also prepared our factories for the launch of new models later this year. Given economic uncertainty resulting from changing trade policy, more affordable options are as critical as ever."

Tesla shares flitted between losses and gains in after-hours trading following the electric vehicle maker's earnings.

Shares were volatile and were up slightly, by about 1%, around 4:15 p.m. ET.

The stock was down about 41% year-to-date through Tuesday's close.

First quarter

• Adjusted EPS: 27c vs. 45c y/y, estimate 43c (Bloomberg Consensus)
• EPS: 12c vs. 34c y/y
• Revenue: $19.34 billion, -9.2% y/y, estimate $21.37 billion
• Gross margin: 16.3% vs. 17.4% y/y, estimate 16.1%
• Operating income: $399 million, -66% y/y, estimate $1.13 billion
• Free cash flow: $664 million vs. negative $2.53 billion y/y, estimate $1.08 billion
• Capital expenditure: $1.49 billion, -46% y/y, estimate $2.49 billion

Tesla stock gained 3.79% to $236.12 ahead of its first-quarter earnings report.

The stock's gains were about double the roughly 2% gain seen in the S&P 500 and Nasdaq 100.

Wells Fargo analysts said they are seeing increasing signs of weak demand for Tesla vehicles across regions.

The firm highlighted that Tesla has started to offer 0% APR on loans for its new Model Y vehicle in China, which is "a sign of weak demand."

"In the US, the new Model Y is available in 2-4 weeks in New York & immediately available in LA, indicating another sign of softening demand," the bank said.

Wells Fargo said Tesla is on track to deliver just 1.35 million vehicles in 2025 based on annualized first-quarter deliveries, which is 27% below consensus estimates. The bank estimates Tesla will deliver 1.66 million vehicles this year, which would represent a year-over-year decline of 7%.

Additionally, the bank warned that a new low-cost vehicle could cannibalize demand for Tesla's higher-priced Model Y, hurting profit margins.

Wells Fargo rates Tesla at "Underweight" with a $130 price target.

Barclays warned that falling profit margins or a tepid outlook from Tesla management "could be a splash of cold water on the stock."

In a note last week, the firm's analysts said its 2025 Tesla earnings per share estimate is $2.24, which is below consensus estimates of $2.65 and well below the consensus estimate at the start of the year of more than $3.20.

The firm said that while there is potential for a "good narrative" for Tesla related to CEO Elon Musk refocusing his time at the company and a coming Full-Self-Driving event, that could be outweighed by "weak fundamentals."

"Amid a soft start on 2025 volume, we believe it will be increasingly difficult for Tesla to achieve volume growth in 2025 — we now forecast negative volumes," Barclays said.

Barclays rates Tesla at "Equal Weight" and lowered its price target to $275 from $325.

Following Tesla's first-quarter delivery results, analysts at Deutsche Bank revised lower their estimates for the company's full-year deliveries.

The firm now expects Tesla to deliver about 1.7 million vehicles this year, down 5% year-over-year.

Importantly, Deutsche Bank highlighted that the weakness in Tesla's vehicle sales is spreading across geographical regions.

"Geographically, we had already factored in a very weak performance from Europe, therefore, US likely led to the downside," Deutsche Bank said of vehicle sales.

The firm also expects Tesla's profit margins to suffer, potentially dropping to the 10% to 11% range from 13.6% in the fourth quarter.

Deutsche Bank rates Tesla at "Buy" with a $345 price target.

Tesla has scaled back its Cybertruck production as it grapples with decreasing demand.

The automaker lowered production targets for several Cybertruck lines in recent months, BI first reported. The changes come to light as a March 20 recall filing said the company has delivered fewer than 50,000 Cybertrucks.

When Tesla launched the Cybertruck in 2023, it was backed by four years of hype, a $120,000 price tag, and a lengthy wait list that helped turn it into a status symbol. A little over a year later, the Cybertruck has become the arguably the most polarizing vehicle on the market.

Tesla has since started to quietly rebrand the Cybertruck as a working man's vehicle, BI's Grace Kay reports. In addition to visible changes, like Tesla redesigning its product page to include photos of the pickup truck hauling equipment, sales workers told BI that there has been a push to increasingly market the Cybertruck toward the traditional truck buyer.

Tesla resale values are cratering as owners sell up amid an escalating backlash over Elon Musk's involvement with DOGE.

The average price of a used Tesla fell more than 10% in March compared to the same period last year, according to data from used car listing website iSeeCars — the largest drop of any car brand in the firm's data.

Prices for pre-owned Model S and Model Y vehicles collapsed 17.2% and 13.1% year-over-year, with the average price of a Model 3 now just over $26,000. That's despite the average price of used cars overall rising slightly in March for the first time in two and a half years, per iSeeCars' data.

Read more here.

Tesla's earnings report and follow-up presentation (which it's calling a "live company update" this time, sparking speculation that the company could show off something new) will be closely watched by both investors and fans.

Here are six things to look out for:

1. The impact of the Elon Musk backlash on Tesla's bottom line
2. A possible end date for Elon Musk's DOGE work
3. An update on a 'more affordable' Tesla
4. Robotaxi service rollout in Austin
5. More details on its Optimus humanoid robot
6. Impact of Trump tariffs

You can dive deeper into each of those topics here.

Wedbush analyst Dan Ives, who has long been bullish on Tesla, said in a note on Sunday that Elon Musk is facing a "Code Red Situation."

According to Ives, Musk needs to distance himself from the government's DOGE committee, which investors worry is distracting him from Tesla this year and turning the EV maker's brand into a political talking point.

Ives wants to see a number of announcements on Tuesday, including: a date for its cyber taxi network to be rolled out, when investors can expect a low-cost vehicle to enter production, a sales timeline for its Optimus robot, and how the company will return to growth in 2025.

Wedbush rates Tesla at "Outperform" with a $315 price target.

JPMorgan reduced its earnings estimates for Tesla following its weak first-quarter delivery results.

Following the results, the bank said it "may have underestimated the degree of consumer reaction" to Tesla and Elon Musk.

"The trend in Tesla sales is worse than we and the market had appreciated, prompting us to lower our already below consensus estimates accordingly and to expect consensus to decline further, toward our new lower estimates," JPMorgan said.

The bank expects Tesla to sell about 1.7 million vehicles in 2025 and earn $2.30 per share in the full year.

JPMorgan rates Tesla at "Underweight" with a $120 price target.

First quarter

• Adjusted EPS estimate: $0.44
• EPS estimate: $0.33
• Revenue estimate: $21.43 billion
• Gross margin estimate: 16.1%
• Operating income estimate: $1.16 billion
• Free cash flow estimate: $1.08 billion
• Capital expenditure estimate: $2.49 billion

Full year

• Production estimate: 2.01 million
• Deliveries estimate: 1.81 million
• Capital expenditure estimate: $11.32 billion

Source: Bloomberg data