Tesla's Earnings Estimates Cut Amid Lower Sales and Regulatory Credit Revenues.

Tesla faces challenges due to lower sales and EPS estimates, with Daiwa revising its 2025 and 2026 EPS predictions from $1.90 to $1.55 and $3.00 to $1.90, respectively. The underwhelming electric vehicle market and declining regulatory credit revenues are expected to pressure Tesla's automotive profit margins. Analysts forecast an average target price of $300.94, with a high estimate of $500.00 and a low estimate of $19.05. The estimated GF Value for Tesla is $270.12, suggesting a downside of 14.54% from the current price.

Tesla (TSLA) reported its second-quarter (Q2) 2025 earnings, missing analysts' expectations as sales fell for the second straight quarter. The electric vehicle (EV) maker reported adjusted earnings per share (EPS) of $0.40 on revenue that fell 12% year-over-year to $22.5 billion, below estimates compiled by Visible Alpha [1].

CEO Elon Musk indicated that the company could face "a few rough quarters" ahead, citing the expiration of EV credits in the U.S. following the passage of the "One Big Beautiful Bill" signed by President Trump earlier this month. CFO Vaibhav Taneja noted that the company's investments in AI, robotics, and energy set it up for a bright future, despite near-term challenges [1].

Shares of Tesla dropped close to 5% in extended trading following the comments, with the stock losing nearly a fifth of its value in 2025 through Wednesday's close. Despite the setback, Musk reassured investors that Tesla remains on track to launch new vehicles this year, including a more affordable model. He also mentioned the company's AI plans and the upcoming Optimus humanoid robot, set to debut at the shareholder meeting in November [1].

Analysts at Wedbush had suggested that they would be more focused on Tesla's potential in self-driving software, robotics, and AI than its short-term sales results. However, the company's recent performance has led to a downward revision of its EPS predictions. Daiwa revised its 2025 and 2026 EPS predictions from $1.90 to $1.55 and $3.00 to $1.90, respectively [1].

The underwhelming EV market and declining regulatory credit revenues are expected to pressure Tesla's automotive profit margins. Analysts forecast an average target price of $300.94, with a high estimate of $500.00 and a low estimate of $19.05. The estimated GF Value for Tesla is $270.12, suggesting a downside of 14.54% from the current price [1].

Meanwhile, tech giant Alphabet (GOOGL) reported after the bell on Wednesday, with results that topped expectations, driven by rising cloud and search sales. It's a key competitor for Tesla in the robotaxi space, with Musk calling out Alphabet's Waymo during Wednesday's call [1].

First Bancorp (FBP), a financial institution with a major presence in Puerto Rico, Florida, and the U.S. Virgin Islands, reported results for Q2 2025 on July 22, 2025. The company's GAAP EPS of $0.50 in Q2 2025 beat the consensus estimate of $0.46 by $0.04, or 8.75% (GAAP). Revenue was $246.85 million, missing analyst estimates, down 1.9% from consensus [2].

References:
[1] https://www.investopedia.com/tesla-earnings-q2-fy2025-11776931
[2] https://www.nasdaq.com/articles/first-bancorp-surpasses-q2-eps-estimates