Tesla (NASDAQ: TSLA) shares closed down 5.75% on Monday, ahead of what could be one of the company’s most scrutinized earnings reports in recent years. With Tesla stock now down nearly 44% year-to-date, investors are bracing for key Q1 figures as concerns over slumping demand, tariff exposure, and brand risk converge.
Tesla is expected to report Q1 revenue of $21.43 billion, slightly above the $21.3 billion recorded a year ago, according to Bloomberg estimates. The consensus forecast calls for adjusted earnings per share of $0.44, translating to $1.57 billionin adjusted net income—marginally higher than the $1.54 billion posted in Q1 2024.
But Wall Street appears less concerned with the headline numbers and more focused on the narrative behind the results—particularly how Tesla plans to navigate softening sales and intensifying competition.
📉 Demand Slips, Deliveries Miss
Tesla’s Q1 vehicle delivery numbers—336,681 units, well below the 390,342 consensus—marked the worst performance since Q2 2022. Analysts cite softening demand in the U.S., Europe, and parts of Asia, where Tesla has long relied on strong brand affinity to drive growth.
“This isn’t just a macro story anymore,” said a portfolio manager at a major EV-focused ETF. “There’s clear evidence of brand erosion and lost ground to rivals like BYD.”
March data from Europe showed a noticeable drop in Tesla registrations, and early April sales data suggest many buyers rushed to purchase EVs before Trump’s new auto tariffs took effect on April 2—hurting Tesla, which manufactures many of its vehicles domestically.
🚗 Brand Under Fire
Tesla’s weakening delivery data coincides with a sharp shift in public sentiment around the company and its CEO. Elon Musk’s recent high-profile political alignment with President Donald Trump, including his role in the newly formed Department of Government Efficiency (DOGE), has fueled growing backlash.
Protests have emerged at Tesla showrooms in the U.S. and Europe, and reports of vandalism targeting Tesla vehicleshave risen, according to local media outlets and social platforms.
“Musk needs to leave the government, take a major step back on DOGE, and get back to being CEO of Tesla full-time,” said Wedbush analyst Dan Ives, calling the current moment a “Code Red situation.”
Ives warned that brand damage is becoming a material risk to Tesla’s growth trajectory, especially in markets where political neutrality is a purchasing factor.
🌍 Global Challenges, Strategic Uncertainty
Tesla faces rising competitive pressure from foreign EV makers, most notably China’s BYD, which has been steadily gaining global share, including in Europe—historically a stronghold for Tesla.
The company’s long-promised affordable EV model, which could broaden access to new demographics, remains delayed. Questions around its production timeline, pricing strategy, and market availability are expected to be addressed during the Q1 earnings call.
Moreover, Tesla’s overseas operations could be challenged by Trump’s new 25% tariffs on auto imports, as well as the resulting trade frictions affecting supply chains and input costs.
🔍 What Investors Are Watching
- Outlook for Q2 and full-year deliveries
- Updates on the affordable EV model
- Commentary on international strategy amid trade disruptions
- Musk’s future involvement in DOGE and government affairs
Tesla’s earnings call on Tuesday after the bell will likely play a pivotal role in shaping near-term sentiment, not just for the company but also for the broader tech and EV sectors under pressure from tariffs, slowing global demand, and shifting investor risk appetite.
