What You Need To Know Ahead of Tesla's Earnings

Tesla (TSLA) is set to announce its first-quarter 2024 earnings after the bell on Tuesday, April 23, with declining deliveries expected to drag down revenue and investors looking for updates on the company's product roadmap after setting a date for the launch of its robotaxi.

Analysts project Tesla's revenue to come in at $22.73 billion for the first quarter of 2024, down from the previous quarter and year-ago period, according to estimates compiled by Visible Alpha.

Adjusted net income is expected to be $2 billion, a decline from $2.49 billion last quarter and $2.93 billion in the prior-year quarter, while adjusted earnings per share (EPS) are projected at 55 cents, compared with 71 cents in Q4 and 85 cents in last year's first quarter.

Key Metric: Q1 2024 Deliveries Tumble

Tesla already reported delivery numbers for the first quarter of 2024 that fell short of analyst expectations, dragging down the stock.

The electric vehicle (EV) maker delivered 386,810 vehicles in the first quarter of 2024, down about 8.5% from the same period in 2023, which could reflect declining EV demand. Tesla reportedly plans to slash its workforce by more than 10% as demand for EVs slows.

Wedbush Securities analysts said that "1Q deliveries was a nightmare quarter for Tesla with China and global EV demand remaining very soft coming out of the gates for 2024." They noted that it "is a crucial period for [Tesla Chief Executive Officer (CEO) Elon] Musk to navigate Tesla through this Category 5 demand storm."

Business Spotlight: Product Roadmap After Robotaxi News

Musk on April 5 said that the company will unveil its robotaxi, a next-generation self-driving vehicle first mentioned in 2019, on Aug. 8.

"Musk has said in the past that Tesla will make a car without controls for human use, saying in the past that [Full Self-Driving] will reach a point of full autonomous use for taxi and driverless scenarios," Wedbush analysts explained.

The robotaxi announcement came shortly after Musk denied a report that Tesla was abandoning its longstanding plan to create a low-priced EV, expected to be called the Model 2.

The analysts said that "Tesla right now is caught between 'two waves of growth' " as "patience is starting to wear very thin among investors," and that a robotaxi is "not the near-term answer." Wedbush said that the firm "remain[s] long term bullish however this is a crucial few months ahead for Musk and Tesla to give the Street its blueprint for growth into 2025."

Tesla was the biggest decliner in the S&P 500 index in the first quarter, and its shares have fallen about 35% since the start of 2024.

UPDATE—April 15, 2024: This article has been updated to reflect more recent analyst estimates and share price information, as well a report that Tesla plans to reduce its workforce.