‘Hang On’ As Analysts Eye DOGE Exit For Elon Musk

Topline

Tesla will report earnings from the first three months of 2025 Tuesday, which analysts expect will reveal the electric vehicle firm’s worst quarter in years as CEO Elon Musk’s outspoken White House role weighed heavily on the company’s performance.

Tesla CEO Elon Musk speaks in Austin in 2022.

AFP via Getty Images

Key Facts

The automaker will release first-quarter results shortly after 4 p.m. EDT’s market close.

Tesla’s far weaker than expected Q1 vehicle deliveries released earlier this month signaled its financials may also leave room for improvement, as the company delivered 337,000 vehicles during the quarter, its worst vehicle delivery growth since 2022 and coming in 17% below consensus analyst delivery forecasts.

Average estimates call for Tesla to report $21.3 billion in revenue and $0.41 earnings per share ($1.4 billion net income) last quarter, according to FactSet.

That would make Q1 2025 Tesla’s worst quarter by sales since Q2 2022 and its least profitable period since Q1 2021.

Looking further under the hood, this could be the worst quarter for Tesla in more than a decade, according to one of Wall Street’s favored measures of the company’s profitability.

Consensus forecasts call for Tesla to report just a 13.1% gross automotive profit margin excluding regulatory automotive credits, which would be the worst reading for the favored metric among Tesla observers since 2012, according to Morgan Stanley analyst Adam Jonas.

Crucial Quote

“Hang on for some weak numbers,” cautioned Jonas in a Tuesday note to clients.

When Is Tesla’s Earnings Call?

The company will livestream its earnings call at 5:30 p.m. on its investor relations website.

What To Watch For

If Musk addresses his timeline for departing the White House during the call. Musk is a senior advisor to Trump and the head of the influential Department of Government Efficiency, having donated $288 million to Trump’s 2024 election efforts. Wedbush analyst Dan Ives wrote Sunday he expects “Musk to address his role in the Trump administration” on the call, and “if Musk chooses to stay with the Trump White House, it could change the future of Tesla” as “brand damage will grow.”

Chief Critic

“We struggle to think of anything analogous in the history of the automotive industry, in which a brand has lost so much value so quickly,” JPMorgan analyst Ryan Brinkman remarked in a note last month. Musk’s powerful role in Washington brought a slew of controversy, culminating in boycotts of Tesla vehicles, protests and vandalism of the vehicles. JPMorgan’s $120 price target for Tesla indicates the U.S.’ largest bank believes shares can decline almost 50% from its $236 share price Tuesday.

Tesla Stock Rebounds Ahead Of Earnings

Shares of the electric and autonomous vehicle firm rose 4% Tuesday morning amid a broader market recovery, clawing back much of the Austin-based company’s Monday losses. Tesla stock is still down more than 40% from its last earnings report in January. How the stock performs following Q1 results will be “dictated” by Tesla’s ability to explain profit margins worse than Volkswagen’s, confidence in progress on driverless taxi offerings and a “sense of increased attention from their CEO,” predicted Jonas.

Forbes Valuation

Musk is worth $361 billion according to our latest estimates, making him by far the richest person on the planet, though he is more than $100 billion poorer than he was at his December peak.