Tesla Has Crashed 35% in 2025: Is It Time to Buy the Stock?

Core Viewpoint - Tesla's recent financial results for Q1 2025 showed a significant decline in revenue and profitability, raising concerns among investors as the stock has dropped 35% in 2025 [1][2]. Financial Performance - Tesla reported a 9% year-over-year revenue drop in Q1 2025, with automotive sales declining by 20% [2]. - The company's operating income fell by 66%, resulting in an operating margin of just 2.1% for the quarter [4]. - Tesla did not provide guidance for the current quarter, citing uncertainty in global trade policies and their impact on the automotive and energy supply chains [4]. Production and Deliveries - Tesla revamped its factories producing the Model Y, contributing to a 13% decrease in EV deliveries compared to Q1 2024 [3]. - The company is set to launch its robotaxi service in Austin, Texas, in June 2025, with plans to expand to other U.S. cities by year-end [5]. Future Plans and Innovations - Tesla aims to begin volume production of the Cybercab, a two-seater designed for robotaxi service, in 2026 [6]. - CEO Elon Musk announced ambitious targets for unsupervised full self-driving capabilities in the U.S. by the end of 2025, predicting significant financial impacts from autonomy in the second half of 2026 [7]. Market Position and Valuation - Despite Tesla's innovative reputation, the company is currently facing challenges with declining revenue and profitability, trading at a forward price-to-earnings ratio of 107, which is considered extremely high given its financial situation [9].