Tesla investors are growing wary of Elon Musk's futuristic promises

Core Viewpoint - Tesla is facing significant challenges with declining vehicle sales, thinning profits, and potential loss of revenue from regulatory credits due to policy changes, leading to a negative investor sentiment [1][2]. Sales Performance - Automotive sales for Tesla declined by 16% year-over-year in the second quarter, with particularly weak sales in Europe and California [3]. - The company anticipates "a few rough quarters" ahead due to expiring EV credits and tariffs imposed by the Trump administration [3]. Stock Performance - Tesla's stock fell 8% in one day and has decreased by 22% year-to-date, marking the worst performance among major tech companies [4]. - Despite a slight recovery of 3.5% on the following day, the overall trend remains negative compared to the Nasdaq, which rose by 1% for the week and over 9% in 2025 [4]. Analyst Sentiment - Analysts from Canaccord Genuity expressed optimism about Tesla's long-term potential with robotaxis but emphasized the need for improved profit and loss dynamics in the short term [4]. - Jefferies described the latest earnings update as "a bit dull," while Goldman Sachs noted that Tesla's robotaxi initiative is still in its early stages with limited data [4].