Copyright Benzinga
Third-quarter earnings from Tesla Inc (NASDAQ:TSLA) after the market close Wednesday could serve as a bellwether for the electric vehicle sector and overall technology sector as the first Magnificent 7 stock to report in this earnings season. Here are the earnings estimates from analysts, what experts are saying ahead of the report and the key items to watch. Earnings Estimates: Analysts expect Tesla to report third-quarter revenue of $26.16 billion, up from $25.18 billion in last year's third quarter, according to data from Benzinga Pro. The company has missed analyst estimates for revenue in four straight quarters and missed estimates in seven of the last 10 quarters overall. Analysts expect Tesla to report third-quarter earnings per share of 53 cents, down from 72 cents per share in last year's third quarter. The company has missed analyst estimates for earnings per share in three straight quarters and missed estimates in seven of the last 10 quarters overall. Read Also: Tesla Insurance Heads To First New State In Three Years: Here’s Where Users Will Soon Have Access What Experts Are Saying: Tesla beating third-quarter delivery estimates, which have already been announced, was due to a "push-forward effect," Cantor Fitzgerald analyst Andres Sheppard said in a new investor note. The analyst, who maintained an Overweight rating and $355 price target, said increased demand came from the expiration of the $7,500 EV tax credit. Sheppard said he expects a weaker fourth quarter for deliveries. Tesla's introduction of lower-priced vehicles comes at an "opportunistic time" according tot the analyst. Sheppard said the new vehicles can attract budget-conscious buyers to Tesla. The analyst said key catalysts for Tesla to watch for the earnings call include robotaxis, ramp-up of lower-cost models, FSD adoption, the launch of the cybercab and an update on the Optimus Bot. Wedbush analyst Dan Ives is looking beyond electric vehicle demand in Tesla's earnings and commentary and focused on key areas like robotaxis, artificial intelligence and China. “After a brutal few quarters we are finally starting to see stable demand trends for Tesla,” Ives said. The analyst maintained an Outperform rating on Tesla with a $600 price target. “The Tesla story going forward is around the AI transformation being led by the autonomous and robotics initiatives.” While some analysts are bullish on the new lower-cost Model Y and Model 3 variants, Goldman Sachs analyst Mark Delaney said they may not be cheap enough or have enough features to catch initial demand. The analyst has a Neutral rating and $425 price target on Tesla ahead of the earnings report. “While we think the broader 3/Y lineup offers good value in general (based on features like acceleration and safety), the degree of differentiation on price and features/form factor for the Standard trims is more limited than we had initially expected for Tesla’s lower cost models,” Delaney said. The analyst stated that at one point, Tesla had planned to introduce a new model that would cost 50% less than the Model 3 and Model Y; however, instead, consumers are getting variants. Delaney said the new, lower-cost models promised were a key item from Tesla’s 2023 investor day. Freedom Capital Markets Chief Market Strategist Jay Woods said the earnings report will play a key in the story of Tesla moving forward, one that could shift away from electric vehicles. "The focus may shift away from auto sales and be more about robotics, autonomous driving and AI," Woods said in a weekly newsletter. Woods said this is the first quarterly report from Tesla since the near $1 trillion pay package for CEO Elon Musk was revealed. The plan sees Musk take no salary and receive compensation based on hitting milestones. "Investors will get their first look as to how he and the company are progressing on those goals when they report Wednesday afternoon." Key Items to Watch: Tesla previously reported third-quarter deliveries of 497,099, a new company record. The company also reported third-quarter production of 447,450 vehicles. With third-quarter figures reported, attention likely turns to commentary on fourth quarter demand and expectations, with the expiration of the federal EV tax credit a major headwind. Declining demand for the Cybertruck could also prompt questions about Tesla's plans for the vehicle's future. The company stated that the Tesla Semi and Cybertruck were both planned for volume production in 2026, as mentioned in the second-quarter results. Analysts and investors will be scrutinizing vehicle timelines to determine if this remains the case. Tesla's second quarter featured commentary on AI and robotics, but this one could go even further as the company looks to these areas for future growth. TSLA Price Action: Tesla stock trades at $445.22 on Tuesday versus a 52-week trading range of $212.11 to $488.54. Tesla stock is up 17.4% year-to-date in 2025. Read Next: Here’s How Many Vehicles Tesla Has Delivered, Produced In Each Quarter Since 2019 Image created using artificial intelligence via Midjourney.
