Tesla(US:TSLA) ZACKS·2026-01-06 10:46Core Viewpoint - Tesla's electric vehicle (EV) deliveries have declined for the second consecutive year in 2025, raising concerns about the company's core business performance and future growth potential [2][4][12]. Group 1: Delivery Performance - In Q4 2025, Tesla sold 418,227 vehicles, a 16% decrease from Q4 2024, with total annual deliveries around 1.64 million, down from nearly 1.8 million in 2024 [4][5]. - The year-over-year decline in deliveries accelerated to over 8% in 2025, compared to a 1% decline in 2024, resulting in Tesla losing its position as the leading EV manufacturer to BYD, which achieved record sales of 2.26 million BEVs, a 28% increase year-over-year [5][12]. Group 2: Future Prospects - CEO Elon Musk is focusing on autonomous vehicles and artificial intelligence as future growth drivers, although significant revenue from these initiatives is not expected for several years [3][12]. - Tesla's robotaxi service, launched in June, is operational in select cities, and the company is testing driverless robotaxis, indicating progress in autonomous mobility [6][8]. Group 3: Energy Business - Tesla's Energy Generation and Storage segment is performing well, with a record deployment of 14.2 GWh of energy storage products in Q4 2025 and a 48.7% increase in total deployments for the year, reaching 46.7 GWh [9]. Group 4: Financial Performance and Valuation - Tesla shares have underperformed the industry, trading at over 13.75 times forward 12-month sales, significantly above the industry average [10]. - The Zacks Consensus Estimate predicts a 3% decline in Tesla's 2025 revenues and a 33% decline in EPS, but forecasts an improvement of 11.6% in revenues and 42.4% in EPS for 2026 [11]. Group 5: Investment Outlook - Despite the delivery slowdown, Tesla's advancements in full self-driving, robotaxis, and energy storage suggest potential for long-term growth, although investors are advised to temper expectations regarding the timeline for monetization [12][13].