Tesla fourth-quarter earnings and revenue came in below views, while automotive gross margin, excluding regulatory credits, tumbled to the lowest since Q4 2017. However, none of that appears to matter for TSLA as investors bet on the bullish tone regarding the years ahead expressed by Chief Executive Elon Musk on the earnings call.
Tesla stock advanced after-hours Wednesday, during Tesla's Q4 earnings call, maintaining a gain into Thursday's market open. Musk appeared to signal that 2025 could be another middling year for the EV giant, with only slight vehicle sales growth, as much of the conference call highlighted the possibility for incredible things to come in 2026, 2027 and 2028.
Musk told analysts that in 2025 Tesla will continue to lay the "groundwork" for an "epic" 2026 and a "ridiculously good" 2027 and 2028. That's based on artificial intelligence, fully autonomous vehicles and the Optimus humanoid robot product, according to Musk.
Arguably the biggest announcement from Thursday was that unsupervised full self-driving, or FSD, will come as a paid service to Austin, Texas, in June. Musk added there will be robotaxi tests in many U.S. cities by year end. The Tesla head was also bullish on Optimus, projecting the company could be selling units sometime in the first half of 2026.
"Long term, Optimus will be overwhelmingly the value of the company," Musk said.
TSLA jumped 1% to 404.60, hitting an intraday high of419.99, during market action on Friday, after advancing 2.9% to 400.28 on Thursday, trading right around the 50-day line. The stock declined 2.3% to 389.10 on Wednesday, as the stock struggled to hold support at its 50-day moving average. The stock ended Friday trade up 0.2% in January.
The Analyst Reaction
Morgan Stanley analyst Adam Jonas, a longtime Tesla bull, wrote Wednesday that the Q4 results were "mostly disappointing," but added that the report was not "particularly narrative changing."
"Tesla's 4Q results are emblematic of a company in the transition from an automotive 'pure play' to a highly diversified play on AI and robotics," Jonas wrote. "While the journey may be volatile and nonlinear, we believe 2025 will be a year where investors will continue to appreciate and value these existing and nascent industries of embodied AI where we believe Tesla has established a material competitive advantage."
William Blair analyst Jed Dorsheimer noted early Thursday that he has "learned to tack 6 to 12 months on Musk's full self-driving (FSD) optimism" but that the June 2025 rollout for unsupervised FSD is "well ahead of our 2026 timeline estimate."
Wedbush Securities analyst Dan Ives, a Tesla uber-bull, wrote that the "surprising news" out of the conference call was the June 2025 target and that this could mean that Tesla's unsupervised FSD" is in the final stages of being ready for the public and the biggest headwinds remain on the regulatory side, not due to technological capabilities."
"With unsupervised FSD expected to be available throughout the U.S. by the end of 2025 and the rest of the world by the end of 2026 this will be a focus of the bulls," Ives wrote Friday.
CFRA's Garrett Nelson added that despite the earnings miss, with Musk backing off prior 2025 vehicle sales growth expectations, TSLA is moving higher on the unsupervised FSD launch.
Electrek reported on Thursday that around a quarter of Tesla's Q4 earnings were due to a $600 billion gain on Bitcoin, meaning Tesla made more profit last quarter from regulatory credits and Bitcoin than from its business operations.
Tariff Hikes, Big Earnings Loom For Market
Tesla Stock Performance
TSLA is seven weeks into a new base with a traditional 488.54 buy point, the record high from Dec. 18, according to MarketSurge charts.
The stock is about 20% below that entry, but poised for a possible rebound, which would be its first following a November breakout.
The EV giant came right up to a downward-sloping trendline on Friday, paring gains on the Trump tariff news.
A move above Friday's high of 419.99 would offer an early entry. Investors also could use the Jan. 17 high of 439.74 to enter Tesla stock. The 21-day exponential moving average provides a good gauge for where to buy if the stock does jump into a rebound.
TSLA stock is on the IBD Leaderboard watchlist. For this afternoon's earnings, the Musk-led earnings call will be the focus, as usual.
The stock has consolidated in January, pausing after a scorching hot fourth quarter where Tesla stock logged most of its 63% advance for 2024, especially after Trump's election win.
Tesla stock ranks first in the 35-stock IBD Auto Manufacturers industry group. The stock has a 92 Composite Rating out of a best-possible 99. Shares also have a 97 Relative Strength Rating and an 84 EPS Rating.
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