Tesla stock (NASDAQ: TSLA) ticked higher in early Wednesday trading as investors positioned ahead of the company’s fourth-quarter 2025 earnings results due after the market closing.
The call carries outsized weight because Wall Street consensus has shifted from fixating on vehicle deliveries to scrutinizing progress on artificial intelligence, robotaxi deployment, and a software subscription business.
The backdrop is sobering as Tesla delivered 418,227 vehicles in Q4, down 16% year-over-year and below Wall Street expectations of 423,000 units.
For the full year 2025, deliveries totalled 1.636 million, marking the second consecutive year of declining sales for a company that recently projected selling 5 million cars annually.
Tesla Q4 earnings preview
Consensus estimates point to Q4 revenue of approximately $24.5 billion, down about 3% year-over-year, driven by lower vehicle deliveries.
Fourth-quarter earnings per share are forecast at $0.45 on a non-GAAP basis, a 38% decline from the $0.73 reported in Q4 2024.
Gross margin is expected to land around 17%, compressed by price competition in China and a pivot toward lower-cost vehicles.
The culprit is familiar as deliveries fell 16%, yet automotive costs held relatively steady, squeezing profitability.
One bright spot stands out. Tesla’s energy storage business deployed a record 14.2 gigawatt-hours in Q4 alone, beating consensus expectations of 13.4 GWh.
For the full year, deployments reached 46.7 GWh, up 49% year-over-year.
That segment is expected to generate $3.4 billion in Q4 revenue with an estimated gross margin of 31%, making it Tesla’s most profitable division by a substantial margin.
But these financial snapshots are almost beside the point as what happens on the conference call, and what management chooses to disclose, will determine how the stock trades afterward.
Tesla stock: What analysts say
Wedbush analyst Dan Ives maintains a $600 price target on Tesla, focusing on the near-term removal of safety drivers from robotaxi operations in Austin, Texas.
Morgan Stanley estimates roughly 1,000 Tesla robotaxis will be operating by year-end 2026.
Tesla is also shifting Full Self-Driving from a one-time purchase to a subscription model at $99 monthly beginning February 14, a move designed to boost adoption and lock in recurring revenue.
The challenge is execution. Optimus robots are still in pilot production, with volume production targeted for 2027.
Regulatory approvals for robotaxis in Europe and China remain uncertain, though an optimistic case points to February 2026 decisions.
Morgan Stanley analyst Andrew Percoco raised the price target to $425 this month but shifted the rating to Equal-weight, arguing that AI hype is fully priced in.
UBS maintains a Sell rating, citing margin pressure and valuation risk.
The truth likely sits between. Investors will parse management commentary on 2026 delivery guidance, robotaxi utilization metrics, FSD subscription adoption, and capex plans for AI infrastructure.
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