Key Takeaways
- Tesla’s Q1 earnings release is scheduled for Wednesday after market close, with Wall Street anticipating revenue of $22.08 billion, reflecting a 9% decline versus the same period last year
- Analysts project adjusted earnings per share of $0.35 and adjusted EBITDA of $3.217 billion, marking a 14.4% decrease compared to Q1 of the prior year
- The company’s Robotaxi program reached Dallas and Houston this past weekend, operating without human safety drivers in both markets
- Capital expenditure plans for 2026 exceed $20 billion, representing more than a 135% increase from 2025’s $8.5 billion, likely resulting in negative free cash flow
- Elon Musk announced the completion of Tesla’s AI5 chip design, which will power electric vehicles, AI training systems, and Optimus humanoid robots
Shares of Tesla (TSLA) declined 1.55% to $386.42 in Wednesday trading as investors awaited the electric vehicle maker’s first-quarter financial results, scheduled for release after the market closes.
While the quarterly figures will draw attention, market participants are equally focused on CEO Elon Musk’s commentary regarding autonomous vehicles, robotics, and semiconductor development.
The Street’s consensus calls for first-quarter revenue of $22.08 billion, representing a 9% year-over-year decline. On the bottom line, adjusted earnings per share are expected to come in at $0.35, while adjusted EBITDA is pegged at $3.217 billion, down 14.4% compared to the first quarter of 2025.
Tesla reported global vehicle deliveries of 358,023 units for Q1, falling just short of the 364,645 consensus estimate, though marking a 6.3% increase year over year. The prior-year period saw unusually low deliveries due to a Model Y refresh transition, making the comparison more favorable.
The company’s Robotaxi initiative is capturing significant investor attention. Tesla launched the service in portions of Dallas and Houston over the weekend, supplementing existing operations in Austin and the San Francisco Bay Area.
The Texas expansion is particularly noteworthy as both markets are operating in “unsupervised” mode, without human safety operators behind the wheel—a configuration Tesla had only deployed on a limited scale in Austin previously.
The company has yet to disclose fleet sizes in each market or the specific number of vehicles running autonomously, creating uncertainty among analysts tracking the program’s progress.
BofA Securities analyst Alexander Perry maintained his Buy recommendation and $460 price objective on Tuesday, pointing to the Robotaxi expansion as a positive catalyst. Perry noted that Tesla is entering the “early stages of monetizing its autonomy efforts” and identified a rideshare market opportunity exceeding $1 trillion in value.
Morgan Stanley anticipates Tesla will soon cross the 10 billion cumulative full self-driving miles threshold, which the firm views as a significant benchmark for machine learning data accumulation and autonomous technology refinement.
Massive Capital Investment Plan Takes Shape
Tesla has outlined capital spending expectations surpassing $20 billion for 2026—a substantial increase from the previous year’s $8.5 billion outlay. This acceleration in investment is widely expected to drive free cash flow into negative territory.
The capital allocation targets new battery technology, Cybercab manufacturing, Optimus humanoid robot production, and artificial intelligence computing infrastructure. The company is constructing its “Cortex 2” data processing facility at the Texas Gigafactory, with plans to more than double on-site computational capacity during the first half of 2026.
Custom Silicon and the Terafab Initiative
Last week, Musk disclosed that Tesla had finalized the design phase—referred to as “taping out”—for its AI5 semiconductor. This chip is designed to power next-generation electric vehicles, large-scale AI training infrastructure, and Optimus robots.
Manufacturing is slated for Tesla’s forthcoming “Terafab” production facility in Austin. Bernstein analysts, however, have estimated that the complete project could demand between $5 trillion and $13 trillion in total capital investment. Bloomberg sources indicated that actual silicon production won’t commence until 2029.
Regarding Optimus development, Tesla had previously indicated plans to introduce a third-generation humanoid robot during Q1. That unveiling did not materialize, and shareholders will be seeking clarity on revised timelines.
Tesla’s fourth-quarter presentation materials outlined an objective to bring Robotaxi service to nine cities during the first half of 2026, with Phoenix, Miami, Orlando, Tampa, and Las Vegas among the targeted markets.
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