Key Points Self-driving cars could create a $10 trillion opportunity in the ride-hailing industry, according to Cathie Wood's Ark Investment Management. Tesla developed its own autonomous robotaxi, but the company is lagging behind the competition when it comes to commercialization. Uber Technologies operates the world's largest ride-hailing network, and it's in an excellent position to dominate the autonomous opportunity. 10 stocks we like better than Uber Technologies › Ark Investment Managemen ...

Core Viewpoint - Tesla's true value may lie in its future product platforms, such as autonomous robotaxis and humanoid robots, rather than its current electric vehicle (EV) sales [1][10] Sales Performance - Tesla delivered 1.79 million EVs in 2024, marking a 1% decline from the previous year, which is the first annual drop since 2011 [5] - In Q1 2025, Tesla delivered 336,681 EVs, reflecting a 13% year-over-year decline [6] - For Q2 2025, Tesla delivered 384,122 EVs, also down 13% year-over-year, indicating a potential sharper annual decline in sales for 2025 compared to 2024 [6] Competitive Landscape - Tesla's sales in Europe fell by 40% in May, while the overall EV market in Europe grew by 26% [7] - Chinese EV brands have doubled their market share in Europe, presenting significant competition for Tesla [7] - Tesla's pricing strategy is challenged by competitors like BYD, which offers lower-priced models, making it difficult for Tesla to compete in key markets [8] Future Product Development - Tesla is focusing on its Cybercab robotaxi, which will operate on full self-driving software, avoiding a price war with competitors [9][10] - The goal is to have millions of Cybercabs generating revenue through passenger transport and small deliveries [10] Financial Implications - Tesla's total revenue shrank by 9% in Q1 2025, with earnings plummeting by 71% to $0.12 per share [13] - The stock is down approximately 34% from its peak, but the decline in earnings is more severe, leading to a high price-to-earnings (P/E) ratio of 173.4 [14] - Comparatively, major tech companies have an average P/E ratio of 35.4, indicating Tesla's stock may be overvalued [15] Market Outlook - If Tesla's FSD and Cybercab initiatives succeed, the current stock price may appear cheap in the long term, but regulatory hurdles remain [16] - Significant declines in stock value could occur if EV sales continue to drop or if the robotaxi business fails to gain traction [18]

Tesla is slated to report first-quarter earnings later this month. The storm could just be getting started In a true moment of irony, Musk's alignment with the Trump administration has gone from being seen as a positive to a stark negative over the last few months. As a reminder, Musk is not just a surrogate for the president -- he's a "special government employee" now. After Trump won in November, he tapped Musk to lead the waste-cutting initiative called the Department of Government Efficiency (DOGE). Ove ...

Core Insights - Tesla is a leading electric vehicle manufacturer, but investor focus is shifting towards its full self-driving software, Cybercab robotaxi, and Optimus robot, which are seen as potential trillion-dollar platforms in the future [1] - Cathie Wood's Ark Investment Management predicts Tesla's stock could reach $2,600 by 2029, driven by products like FSD and Cybercab [2][3] - Despite this optimistic outlook, Tesla's stock has dropped 43% from its recent high due to weaknesses in its core EV business [3] EV Sales Performance - Tesla delivered a record 1.8 million cars in 2023, marking a 38% year-over-year increase, but deliveries shrank by 1% in 2024 [4] - In early 2024, Tesla's EV sales in Europe fell by 43%, and by 66% in Australia, with flat sales expected in China [5] - Competitors like BYD and Great Wall Motors are selling base-model EVs for under $15,000, making it difficult for Tesla to compete [6] Market Dynamics - Consumer hesitance towards Tesla may be influenced by Elon Musk's political involvement, leading to increased dealership attacks and declining resale values [7] - Tesla's revenue in 2022 was $97.6 billion, with 79% from EV sales, but projections suggest EV sales will only account for 26% of revenue by 2029, with autonomous ride-hailing becoming the majority [8] Future Projections - Ark estimates that Tesla's Cybercab could generate $756 billion in annual revenue by 2029, contributing to a total revenue of $1.2 trillion [11] - The success of Tesla's autonomous ride-hailing service is contingent on the approval of FSD for unsupervised use, which has not yet been granted [10] Financial Metrics - Tesla's earnings per share (EPS) fell by 53% in 2024 to $2.04, with a high price-to-earnings (P/E) ratio of 134, significantly above the S&P 500's 22.9 [13] - The stock would need to drop by 82% to align with the S&P 500, and further declines in EPS are expected if EV deliveries continue to decrease [14] Investment Considerations - While Tesla stock may appear attractive if Ark's forecasts are accurate, the high risk of further downside suggests caution for investors [15][16]

Ark Investment Management, which was founded by prolific technology investor Cathie Wood, thinks the autonomous ride-hailing industry could generate $14 trillion in enterprise value by 2027. Tesla (TSLA 11.78%) is a leading developer of self-driving technologies, and its new Cybercab robotaxi -- which will be able to haul passengers with no human input -- could hit American roads as soon as this year.But Tesla might not be the biggest winner of the autonomous revolution. Instead, I think Uber Technologies ( ...

Core Insights - Tesla's stock experienced a significant increase of 63% last year, reaching an all-time high in December, driven by investor optimism regarding a favorable regulatory environment for its autonomous driving and robotics technologies [1] - CEO Elon Musk envisions Tesla potentially becoming the most valuable company globally, possibly exceeding the combined market value of the next five largest companies, which currently totals $13.4 trillion [2] - However, Tesla's stock has recently declined by 44% from its peak, raising concerns about its ability to achieve such lofty valuations [3] Business Performance - Tesla's core business is heavily reliant on electric vehicle (EV) sales, which account for 79% of its revenue, facing increasing competition that is impacting sales [4] - Despite Musk's previous claims of 50% annual production growth, actual deliveries grew only 38% in 2023 and decreased by 1% in 2024, indicating potential challenges ahead [5] - Sales in Europe have seen a drastic decline, with a more than 50% drop year-over-year in January, including a nearly 60% decrease in Germany, highlighting a significant loss in market share [6][7] Competitive Landscape - Consumers are increasingly opting for lower-cost EVs from competitors like BYD, which offers vehicles priced under $10,000, leading to a substantial decline in Tesla's sales in key markets [8] - Tesla's sales in Norway, France, Sweden, and Denmark also experienced significant drops, indicating widespread challenges across Europe [7] Future Prospects - Musk is focusing on autonomous driving and robotics as key growth areas, believing that products like the full self-driving software and humanoid robots have much larger addressable markets than EVs [9] - The full self-driving software is not yet approved for unsupervised use in the U.S., but Musk anticipates its rollout in Texas and California soon, with potential revenue from a robotaxi network [10] - Analysts estimate that the full self-driving technology could add $1 trillion to Tesla's market capitalization over time, while Ark Investment Management projects $756 billion in annual revenue from autonomous ride-hailing by 2029 [11][12] Valuation Concerns - Tesla's earnings per share (EPS) fell by 53% to $2.04 in 2024, attributed to declining EV sales and price cuts that affected profit margins [14] - Despite a 44% drop in stock price, Tesla's price-to-earnings (P/E) ratio remains high at 128.6, significantly above that of major competitors [14] - For Tesla to surpass the combined value of the five largest companies, its stock would need to increase by 1,500%, which appears unrealistic given its current valuation and earnings trajectory [15][16]