Tesla announced worse-than-expected fourth-quarter earnings and revenue late Wednesday, but robotaxi hopes provided support. Shares of TSLA advanced as Chief Executive Elon Musk said on the earnings call that unsupervised full self-driving will come to Texas in June and that the robotaxi will arrive in 2026.
Tesla reported Q4 EPS of 73 cents, growing 3% compared to Q4 2023, while revenue increased 2% to $25.71 billion. Analysts expected earnings of 77 cents per share and sales coming in at $27.26 billion, according to FactSet.
Meanwhile for 2025, current consensus has Tesla profit returning to year-over-year growth, after the expected dip for 2024.
6:41 p.m. ET
Earnings Call Has Ended
Musk says they are trying to solve battery production for vehicle output, there will also be the factory retooling on the new Model Y, which will have a "short term impact on output."
The Q&A with analysts has ended as has the the call with Musk and Tesla executives.
Tesla stock is up more than 4% as the call comes to a close.
6:14 p.m. ET
Austin Paid Self-Driving Rides
To clarify, Musk said that Tesla aims to offer paid self-driving rides in Austin, suggesting that mid-2025 will be the start of Tesla's robotaxi efforts.
Update: Musk later said an internal self-driving fleet will in several cities by the end of the year.
Optimus For Sale In 2026
The Optimus will be available for sale at the beginning of 2026 or mid-2026, per Musk.
"Demand will not be a problem, even at a high price," Musk said, on Optimus, who added that at a million units per year the production cost will be less than $20,000.
6:09 p.m. ET
CFO Cites 'Idle' Margin Pressure
Tesla CFO Vaibhav Taneja said margins will be impacted due to "idle capacity" and other related costs. He said this should shift with the unboxed production of the Cybercab.
It's not clear if Tesla has figured out how to make "unboxed" a reality. In the earnings release, the EV giant said, "Our purpose-built Robotaxi product – Cybercab – will continue to pursue a revolutionary "unboxed" manufacturing strategy and is scheduled for volume production starting in 2026."
6:03 p.m. ET
True FSD 'Most Likely' In Much Of U.S. By Year-End
Musk says Tesla "most likely" will release unsupervised FSD in "many regions" of the U.S. by the end of 2025.
5:55 p.m. ET
Biggest Year In Tesla History?
2025 is really a pivotal year for Tesla and when people look back on 2025 and the launch of unsupervised self driving, true, real world AI that actually works — I think this may be the biggest year in Tesla history," Musk said.
5:53 p.m. ET
Optimus Projections 'Insane'
Musk admits his revenue projections for Optimus appear "absolutely insane" but that he believes they will be accurate. The internal plan for Optimus is to produce roughly 10,000 in 2025, according to Musk. However, he said that target may be unrealistic. It doesn't take many years until we're making 100 million of these things a year," Musk said, referring to Optimus.
5:51 p.m. ET
Tesla Self Driving Not 'Far Off, Mythical'
"Teslas will be in the wild, with no one in them, in June, in Austin," Musk said. "This is not some far off, mythical situation, it's literally five, six, months away."
5:49 p.m. ET
Tesla Stock Pops
Tesla stock, which had been trading modestly positive after hours, was up 4% following Musk's comment on true self-driving starting in June.
5:46 p.m. ET
Unsupervised Tesla FSD In June
Musk said Tesla will launch unsupervised FSD in Austin, Texas, in June.
He said that thousands of Tesla vehicles are already driving fully autonomously at the company's California plant in Fremont.
5:45 p.m. ET
Optimus Revenue Potential Above $10 Trillion
The Tesla chief sees the Optimus robot with the potential of "north" of $10 trillion in revenue.
5:44 p.m. ET
Musk Sees Battery 'Constraint'
Musk claims that battery backs are a "constraint" this year but that Tesla is working to address that constraint. "I think we will make progress on addressing that constraint and then things are really going to go ballistic next year and then really ballistic in 2027 and 2028."
Along with his statement that 2025 is laying the "groundwork," Musk seems to be more muted about this year.
5:41 p.m. ET
Elon Musk Sees 'Epic' 2026
Elon Musk says 2025 is laying the "groundwork" for an "epic" 2026 and a "ridiculously good" 2027 and 2028. That's based on AI, autonomous vehicles and autonomous humanoid robots
He added, "We see a path to Tesla being the largest company in the world and more valuable than the next top five companies combined!"
"The reality of autonomy is upon us," Musk says, again touting the outlook for the value add of FSD.
5:29 p.m. ET
Gross Margins Skid
After a surprise gain in Q3, Tesla's total gross margins fell 138 basis points to 16.3%. Auto gross margins excluding regulatory tax credits tumbled to 13.6% vs. 15.7% expected, per FactSet.
5:22 p.m. ET
Free Cash Flow Falls, Cash Up
Tesla reported free cash flow fell 2% to $2.03 billion in Q4. Cash and cash equivalents increased 26% to $36.56 billion.
4:40 p.m. ET
Tesla Sees 'Seminal' Year For FSD
Tesla said that "2025 will be a seminal year in Tesla's history as FSD (Supervised) continues to rapidly improve." The company said in its Q4 earnings that it expects to begin launching its Robotaxi business "later this year in parts of the U.S."
Cybercab volume production is expected to start in 2026.
Looking to 2025, Tesla reported that "with the advancements in vehicle autonomy and the introduction of new products" it expects the "vehicle business to return to growth in 2025."
"The rate of growth will depend on a variety of factors, including the rate of acceleration of our autonomy efforts, production ramp at our factories and the broader macroeconomic environment. We expect energy storage deployments to grow at least 50% year-over-year in 2025," Tesla reported Wednesday.
The company added that its plans for new vehicles, including more affordable models, "remain on track" for production in the first half of 2025. Tesla said the Robotaxi, or Cybercab, is scheduled for volume production starting in 2026.
The EV giant already reported record fourth-quarter deliveries on Jan. 2, but the number came in below analyst expectations as the company failed to hit its target of annual vehicle unit growth compared to 2023.
TSLA dropped more than 2% after the market closed, adding to a 2.3% fall to 389.10 during regular market action, undercutting the 50-day line.
The stock fell more than 4% last week and is currently down around 3.6% in January.
What To Watch For On Earnings Call
With the Q4 earnings call upcoming, investors will be looking for 2025 delivery guidance, and for information on the Tesla's long-awaited "affordable" vehicle. They want to know whether fully autonomous self-driving remains on track for California and Texas by mid-2025, and would like details on the timeline for the much-touted Optimus humanoid robot.
"More attention will be paid to comments on the outlook including a reiteration (or not) of the 20% to 30% FY24 delivery growth target, Model Y 'Juniper' ramp, FSD rate of change, AI infrastructure expansion, Cybercab deployment targets, Optimus milestones, and a potential (and long overdue) deep-dive 'AI Day,'" wrote Adam Jonas, Morgan Stanley's high-profile auto analyst and a TSLA bull, on Friday.
On Wednesday, Tesla's social media account on X touted its full self-driving, or FSD, capabilities, showing off a video of vehicles driving themselves from the factory to loading docks.
"The future will have lots of robots," Tesla said on X.
'Affordable' Vehicle And Delivery Guidance?
Tesla at the beginning of Q4 said plans for new vehicles, including more affordable models, remain on track for start of production in the first half of 2025. The long-awaited "cheaper" Tesla model vehicle is expected sometime in the first half of 2025. However, that could change as the new vehicle release has long been speculated about.
The price tag on the vehicle is also as of yet unclear. Musk said on the third-quarter earnings call that the upcoming "affordable" EV will cost less than $30,000, "with incentives." Where the price will land if the IRA tax credit is repealed by Trump remains in question.
Meanwhile, Musk proclaimed on the Q3 earnings call that vehicle sales could grow "20%-30%" in 2025. Analysts are pegging 2025 delivery numbers at 2.05 million, according to FactSet. This would represent 14% growth compared to 2024, but still well below Musk's 2025 forecast from the beginning of Q4.
FSD And Optimus Outlook
Musk has also said he expects Tesla's FSD to achieve true self-driving by mid-2025, though he's said similar "this year" or "next year" statements for about a decade.
Musk on the third-quarter earnings call said he expects "fully autonomous unsupervised FSD in California and Texas next year — that's with the Model 3 and Model Y." However, Musk admitted that he tends to be a "little optimistic with time frames."
Any update on the Q4 call on the timeline for fully unsupervised self-driving will be key for investors as Tesla stock mainly jumped higher to end 2024 on the belief that President Donald Trump will ease regulations for autonomous vehicles. Musk is currently a big supporter of the president and a de facto member of the administration.
The Optimus robot timelines have also been fuzzy at best and nonexistent at worst. So any details on the humanoid on the Q4 call will be noteworthy. In November, Musk posted to X that Optimus is "already doing some tasks in the factory and the scope of its ability is increasing rapidly."
"The toughest part by far is improving the design of Optimus for ease of manufacturing and tooling up a complex supply chain, so it can be made in significant numbers," Musk wrote on Nov. 7.
Tesla Stock Performance
Tesla stock 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 23% below that entry, but poised for its first rebound following a November breakout.
A bounce above the 21-day exponential moving average would mark a buying opportunity. Investors could also plot an early entry off the 439.74 high from Jan. 17.
Tesla Earnings Unexpectedly Rise 9% In Q3, Elon Musk Bullish
TSLA stock is on the IBD Leaderboard watchlist. For this afternoon's earnings, the Elon 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 a 77 EPS Rating.
Read more on Tesla second-quarter earnings or on the company's first-quarter report.
Please follow Kit Norton on X @KitNorton for more coverage.
YOU MAY ALSO LIKE:
Is Tesla Stock A Buy Or A Sell?
Get Full Access To IBD Stock Lists And Ratings
Learning How To Pick Great Stocks? Read Investor's Corner
AI Is Fueling A 'Nuclear Renaissance.' Bill Gates And Jeff Bezos Are In The Mix.
The Lithium Price Cycle Has Bottomed. What To Expect Next For These Stocks.
Futures: Tesla Jumps On Robotaxi Bets, Leads Big Earnings Movers
