Tesla shares (TSLA) dropped sharply Thursday after the company’s earnings report reignited concerns over its self-driving future. Analysts are now warning that the window is closing for Tesla to deliver on its bold promises, especially when it comes to robotaxis.
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The stock was down 6.4% to $311.23 in premarket trading, wiping out early gains from the night before. Investors reacted to CEO Elon Musk’s cautious tone on the earnings call and the growing skepticism from Wall Street over the company’s autonomous timeline.
“Robotaxi is the focus but there is still some cloudiness,” said Baird analyst Ben Kallo in a post-earnings note shared with clients.
Tesla Is Running Out of Time to Deliver Big Tech Promises
For years, Musk has pitched a future built on full self-driving vehicles, automated taxi networks, and even humanoid robots like Optimus. These visions have helped support Tesla’s high valuation, even as its core auto business faces increasing pressure from global rivals and falling EV subsidies.
But analysts at Baird say patience is wearing thin. “We are mixed on Tesla’s ability to meet its robotaxi timelines, cost targets, and scale,” Kallo wrote.
Tesla has benefited from the excitement around revolutionary products, which has helped it avoid scrutiny over missed deadlines. However, Baird believes that if the current softness in Tesla’s EV sales continues, the market’s attention may shift back to near-term results instead of far-off ambitions.
Musk Warns of a Rough Ride Ahead
Musk acknowledged that there could be challenges in the next few quarters. Speaking on Wednesday’s earnings call, he pointed to reduced government incentives as a headwind for EV makers in general and Tesla in particular.
“We probably could have a few rough quarters. I’m not saying we will, but we could. Q4, Q1, maybe Q2,” Musk said.
Still, Musk reaffirmed his belief that autonomous vehicles will reshape Tesla’s financial picture, just not immediately. “Once you get to autonomy at scale in the second half of next year, certainly by the end of next year… I would be surprised if Tesla’s economics are not very compelling,” he added.
Robotaxis Are the Big Test
Tesla’s robotaxi platform is meant to be the company’s next major growth driver. Musk has teased a reveal event for the vehicle in August, calling it “next-level.” But that event alone won’t be enough. Analysts and investors will want to see timelines, pricing, and production capacity.
In the meantime, pressure is building. Companies like Waymo and Cruise have made real-world deployments in major U.S. cities, while Tesla’s Full Self-Driving beta remains in testing phases and lacks regulatory approval in most markets.
Without a clear rollout plan, Tesla risks losing its edge in a race it helped start.
Is Tesla Stock a Buy, Hold, or Sell?
TipRanks data shows that Tesla stock currently carries a “Hold” rating, based on 33 Wall Street analyst reviews from the past three months. Of those, 14 analysts rate the stock a Buy, 12 recommend to Hold, and seven suggest to Sell.
The average 12-month TSLA price target sits at $305.79, which represents an 8.05% downside from the current price of $332.56.
