Tesla began 2025 facing investor concerns after missing fourth-quarter 2024 delivery expectations. Stifel analyst Stephen Gengaro characterized the results as a modest negative for Tesla’s stock, noting that the delivery shortfall highlights challenges in meeting market expectations despite ongoing momentum in specific business areas such as energy storage.

The upcoming earnings report on January 29 will be pivotal as investors seek clarity on Tesla’s pricing strategies and automotive margins.

Key Fourth-Quarter Metrics

Tesla’s total deliveries for the fourth quarter of 2024 reached 495,570 vehicles, trailing Stifel’s estimate of 516,961. The results also marked a rare annual decline, with 2024 deliveries falling approximately 1.1 percent below 2023 levels.

Model 3 and Model Y vehicles accounted for 471,930 of the deliveries, slightly below forecasts, while other models, including the Model S, Model X, and Cybertruck, also underperformed expectations.

Production figures were similarly disappointing, with Tesla producing 459,445 vehicles in the quarter, missing projections by 12.1 percent and representing a 2.2 percent sequential decline. These results underscore operational pressures as Tesla ramps up production for newer models like the Cybertruck, which are expected to play a significant role in the company’s future growth.

Strength in Energy Storage

Amid the delivery challenges, Tesla’s energy storage segment provided a bright spot. Deployments reached a record-high 11.0 GWh during the quarter, aligning with robust analyst expectations. This business line, which includes Tesla’s Powerwall and Megapack products, continues to demonstrate significant growth potential and serves as a diversification pillar for Tesla’s overall revenue base.

Focus on Margins and Pricing

Investors will closely scrutinize Tesla’s January 29 earnings release for insights into automotive margins, particularly the Automotive Sales gross profit per delivery. The results will help clarify the extent to which price reductions and discounts impacted profitability during the quarter. As Tesla navigates an increasingly competitive electric vehicle market, balancing volume growth with margin preservation will be critical.

Outlook for 2025

Tesla’s trajectory in 2025 hinges on several factors, including the success of its Full Self-Driving (FSD) software and the performance of the newly launched Cybertruck. These products are expected to be key drivers of revenue growth and market sentiment. Additionally, the company’s ability to execute on its production goals and manage costs amid potential macroeconomic headwinds will be closely monitored.

Conclusion

Tesla’s delivery miss in the fourth quarter of 2024 has tempered some of the optimism surrounding the company, but its energy storage segment and upcoming product launches provide reasons for cautious optimism.

The January 29 earnings report will serve as a critical moment for Tesla to demonstrate resilience, transparency, and a clear path forward. Investors will look for signs that Tesla can maintain its leadership in the EV market while navigating challenges in production, pricing, and profitability.