The stakes are high for Tesla when the electric vehicle giant reports results after the bell Wednesday. Analysts polled by LSEG expect the company to report earnings of 58 cents per share on $25.37 billion in revenue. The company posted adjusted earnings per share of 52 cents and revenue of $25.50 billion last quarter . The current numbers suggest a 12% decline in earnings from the year-ago period . The earnings release come on the heels of a rocky patch for the stock. It is down 13% in 2024 and has lost 17% this month. Earlier this month, the EV giant posted disappointing third-quarter delivery numbers . The delivery miss comes as the company grapples with an increasingly competitive EV market, as legacy automakers join the tide and competitors such as Rivian mature their business. Abroad, the company is facing elevated pressures in China from competitors such as Li Auto and newer entrants including Geely . Stakes are even higher for the company following an underwhelming robotaxi event earlier this month that failed to impress Wall Street analysts and investors hopeful for a turnaround. “See substantial risk of multiple compression after big TSLA rally into underwhelming robotaxi day came despite deteriorating fundamentals, suggesting unmet investor expectations,” wrote JPMorgan analyst Ryan Brinkman following the event. Heading into the print, Wall Street analysts view Tesla’s automotive gross margins as a key figure that may heavily affect the EV giant’s postearnings move. Piper Sandler analyst Alexander Potter warned investors to prepare for several months of “choppy” action and valuation contraction should the figure fail to rise over last quarter. “Our overweight rating isn’t especially reliant upon automotive gross margin, but in our experience, near-term trading sentiment often relies on this metric whenever ‘outside-the-box’ revenue streams (e.g. robo-taxis) seem like distant possibilities,” he wrote. Potter also views an exciting new catalyst such as a take-rates for full-self driving software as necessary to lift investor sentiment and help shares re-rate. Cantor Fitzgerald’s Andres Sheppard also suspects that the company may provide more details on its robotaxi following this month’s lackluster event. Sheppard has a neutral rating on the stock. Barclays analyst Dan Levy views a stabilization in estimates, third-quarter beat and margin improvement as a potential near-term catalyst for the stock, but noted that the longer-term outlook appears “uncertain.” He retained an equal weight rating and $220 price target, implying that share will trade in a range from here. TSLA YTD mountain Shares this year Jefferies analyst Philippe Houchois lifted his price target to $195 from $165 to account for higher revenue to free cash flow metric and earnings before interest and taxes between 2024 and 2026, but retained his hold rating. The new target still reflects more than 10% downside from Tuesday’s close. “Tesla remains a fascinating business in terms of innovation and drive but, more than ever, looks like an imbalanced VC portfolio solely funded by an auto business under pressure,” he said, adding that the robotaxi event fell a bit flat,” he wrote.
