Key Points
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Tesla’s autonomous driving business could be worth trillions, according to Wall Street analysts.
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Over 70% of Tesla’s revenue is from passenger electric vehicles, which are currently experiencing a decline.
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Tesla will report its financial results for the second quarter of 2025 on July 23, with expectations of poor performance.
Tesla (NASDAQ: TSLA) is facing challenges as its electric vehicle (EV) business shows signs of decline. As of June 30, 2025, Tesla delivered 720,803 cars in the first half of the year, a 13% drop from 2024. The company also anticipates lower revenue and earnings on July 23, following a trend where deliveries shrank by 1% in 2024. This marks the first annual decline since the Model S launch in 2011.
Tesla’s revenue is primarily from its EV sales, which accounted for 72% of total revenue; however, increased competition, particularly from Chinese manufacturers like BYD, is impacting sales. For instance, Tesla’s EV sales in Germany fell by 60% in June while overall EV sales in the country grew by 8.6%. Meanwhile, Tesla has future ambitions surrounding autonomous vehicles, with projections that its Cybercab robotaxi service could significantly boost its valuation, but it’s still in early testing phases.
Experts predict that while Tesla’s autonomous ride-hailing service may lead to future profitability, immediate results from its declining EV sales could lead to a further increase in its high P/E ratio of 172.2. Investors are advised to approach potential stock purchases cautiously ahead of the upcoming financial report on July 23, 2025.
