Tesla Earnings Preview: What to Expect

Company Overview - Tesla, Inc. (TSLA) is headquartered in Austin, Texas, and specializes in electric vehicles (EVs), energy storage, and clean energy solutions, with a market cap of $1.5 trillion [1] - The company offers a range of products including luxury EVs like Model S, Model X, and Model Y, as well as solar panels, solar roofs, and energy storage systems [1] Earnings Expectations - Analysts expect TSLA to report a profit of $0.34 per share on a diluted basis for Q4 2025, which represents a 48.5% decline from $0.66 per share in the same quarter last year [2] - For the full fiscal year 2025, the expected EPS is $1.12, down 45.1% from $2.04 in fiscal 2024, but projected to rise 58.9% year over year to $1.78 in fiscal 2026 [3] Stock Performance - TSLA stock has underperformed the S&P 500 Index, which gained 16.2% over the past 52 weeks, with TSLA shares only up 5.3% during the same period [4] - The stock also underperformed the Consumer Discretionary Select Sector SPDR Fund's returns of 6.8% [4] Challenges Facing the Company - Tesla's underperformance is attributed to declining production and deliveries, increased competition from Chinese rivals like BYD Company Limited and XPeng Inc., and margin pressure [5] - Deliveries of Models 3 and Y have dropped year over year, and lower-priced models have not compensated for this decline [5] Recent Financial Results - On October 22, 2025, TSLA reported Q3 results with revenue of $28.1 billion, reflecting an 11.6% year-over-year increase, while adjusted EPS declined 30.6% from the previous year to $0.50 [6] Analyst Ratings - The consensus opinion on TSLA stock is cautious, with a "Hold" rating overall; out of 40 analysts, 14 recommend a "Strong Buy," 1 a "Moderate Buy," 16 a "Hold," and 9 a "Strong Sell" [7] - TSLA currently trades above its mean price target of $395.32, with a Street-high price target of $600 indicating a potential upside of 38.6% [7]