Tesla stock is jittery ahead of Q1 earnings: what to expect?

Shares of Tesla were wobbly on Tuesday, slipping 0.2% to $392.90 as investors positioned ahead of the company’s first-quarter earnings report.

Wall Street expects Tesla to report earnings per share of 36 cents on revenue of $22.3 billion.

In the same period a year earlier, the company posted earnings of 27 cents per share on revenue of $19.5 billion.

The projected growth reflects higher vehicle deliveries, which rose to approximately 358,000 units in the first quarter of 2026 from about 337,000 in the corresponding period last year.

Analyst views remain mixed

Analyst sentiment ahead of earnings remains divided.

BofA Securities reiterated a Buy rating on Tesla with a $460 price target.

Analyst Alex Perry said the firm sees significant long-term opportunity from Tesla’s robotaxi initiatives, describing autonomy as a key driver of the next phase of mobility.

BofA believes Tesla is still in the early stages of monetising its autonomous capabilities and highlighted potential benefits, including improved safety, time savings, and broader accessibility for consumers.

In contrast, Jefferies maintained a more cautious stance, raising its price target to $350 from $300 while keeping a Hold rating.

The firm expects first-quarter revenue of $21.2 billion, representing a 10% increase year-on-year.

Jefferies also forecasts a decline in core automotive gross margins to 15.5% from 17.2% in the fourth quarter, citing lower volumes and higher depreciation and amortisation costs.

AI strategy remains key driver

Tesla’s valuation continues to be closely tied to its long-term ambitions in artificial intelligence, making updates on its Full Self-Driving (FSD) system and robotaxi rollout critical for investor sentiment.

Market participants are expected to focus on progress in these areas when the company reports results, rather than on near-term financial metrics alone.

Last week, Tesla shares snapped an eight-week losing streak, rising nearly 15% following a chip update and regulatory approval in the Netherlands.

The rebound was also supported by broader market gains linked to a ceasefire agreement between the United States and Iran.

Muted moves ahead of earnings

Tesla shares have shown a pattern of limited movement ahead of earnings releases, followed by more pronounced reactions afterwards, as investor sentiment is often shaped by forward-looking commentary rather than reported financials.

In January, when Tesla reported fourth-quarter results, the stock rose 0.1% on the day of the announcement but fell 3.5% the following session, as investors reacted to plans for $20 billion in capital expenditure and concerns about margins amid slowing auto sales.

A similar but opposite pattern emerged in October, when shares declined 0.8% on the day of earnings before rising 2.3% the next day after Chief Executive Officer Elon Musk said the company’s Optimus robots would begin production in late 2026 and that its robotaxi service would expand to at least eight additional cities.

Outlook hinges on execution

Tesla’s near-term stock performance is likely to depend less on its reported earnings and more on management’s ability to demonstrate progress in its AI initiatives.

While recent gains suggest improving sentiment, investors remain focused on whether Tesla can translate its technological ambitions into tangible growth, particularly in areas such as autonomous driving and robotics.

With earnings imminent, the company’s commentary on these fronts is expected to play a decisive role in shaping market reaction.