Tesla may announce its largest quarterly revenue decline in over a decade on Wednesday, July 23. At the moment, the electric car manufacturer is facing intensified competition, a lack of new models, and concerns over the backlash against its CEO, Elon Musk.
Here are five key issues that investors, analysts, and Tesla enthusiasts may be focusing on:
Musk recently established the America Party after a public dispute with President Trump over tax and spending legislation earlier this month. This move has reignited worries about how Musk’s political activities may impact Tesla’s development at a time when the company is striving to compete fiercely, especially in the crucial Chinese market, and transform itself into a robotics and AI company.
Musk has stated that he has resumed working seven days a week, sleeping in the office when his children are not around.
Last month, Tesla launched a small-scale test of its self-driving taxi service in Austin, Texas, involving restrictions on around a dozen Tesla Model Y SUVs, including a safety supervisor in the front passenger seat. Despite some driving errors captured on video, Tesla enthusiasts have praised these tests.
Musk has announced plans to launch the service in the San Francisco Bay Area “within a month or two,” pending regulatory approval. However, California regulators informed Reuters this month that Tesla has not yet applied for the necessary permits to test or deploy unmanned driving vehicles. Investors will be interested in how expansion plans will proceed.
Musk’s focus on self-driving taxis led to the cancellation of a plan to establish a new, cheaper electric vehicle platform. Tesla had promised to start production of the first batch of cheaper electric models by the end of June, but the company has not confirmed if they have met this target. Investors are eager to know the latest progress on these plans.
Sources had informed Reuters in April that a simplified version of the Model Y is likely to be delayed by several months.
Eight analysts interviewed by Visible Alpha have revised down their 2025 delivery estimates for this cheaper vehicle from over 63,500 vehicles at the beginning of the year to below 50,000 vehicles.
Tesla introduced a new version of the Model Y this year, with investors hoping it will boost the company’s sluggish sales performance. Deliveries of Tesla’s SUVs and Model 3 compact sedans plummeted significantly in the second quarter.
Tesla attributed the sharp decline in deliveries to a production halt in January for factory retooling, but some analysts believe that new features, including new front and rear light bars and a rear passenger touchscreen, are not enough to stimulate demand. Investors are keen to hear Musk’s perspective.
Total deliveries in the second quarter fell by 13.5% to 384,122 units, marking the second consecutive quarter of decline, despite aggressive discounts and low-cost financing. Revenue is expected to drop by 11.2% year-on-year.
The sale of regulatory credits is a profit engine for Tesla, but it is expected to dwindle following recent congressional legislation. In 2024, Tesla earned $2.8 billion from selling such credits to traditional automakers to help them comply with emission regulations. Without these credits, Tesla would have reported a loss in the first quarter of this year.
Considering the pressures Tesla is facing, analysts have been readjusting their revenue forecasts for the company.
(This article was compiled with reference to reports from Reuters)