- Benchmark maintains a Buy rating and $475 price target on Tesla, citing Q2 revenue expectations of $22.7B (17% QoQ growth).
- EPS projected at $0.33, below consensus due to margin pressures from tariffs, pricing, and warranty costs.
- Tesla’s Q2 deliveries fell 13.5% YoY to 384,122 units, with inventory concerns lingering.
Bullish Stance Despite Margin Headwinds
Benchmark remains bullish on Tesla (NASDAQ: TSLA) despite near-term challenges, reiterating its Buy rating and $475 price target. The firm expects Q2 2025 revenue to reach $22.7 billion, a 17% quarter-over-quarter increase and slightly above consensus estimates. However, adjusted EPS is projected at $0.33, trailing consensus due to persistent margin pressures.
Tariffs, competitive pricing, and rising warranty costs are squeezing profitability, even as Tesla’s energy storage business (9.6 GWh deployed in Q2) provides stability. Vehicle deliveries totaled 384,122 units, down 13.5% year-over-year, with a production-delivery gap of ~25,000 units suggesting elevated inventory.
Macro and Political Overhangs
Trade policy remains a wildcard, particularly U.S.-China EV tariffs, while CEO Elon Musk’s political engagements continue to stir reputational debates. Tesla suspended full-year 2025 guidance last quarter, leaving analysts parsing Q2 commentary for clues on autonomous driving initiatives and cost controls.
“The stock’s volatility reflects bifurcated expectations,” said one sector analyst, speaking anonymously due to firm policy. “Long-term bulls see scalability and tech moats, but short-term headwinds are undeniable.”
Sector-Wide Pressures
Tesla isn’t alone—global EV demand has plateaued, with legacy automakers and Chinese rivals like BYD facing similar margin compression. Benchmark’s optimism hinges on Tesla’s ability to leverage its industry-leading scale, though execution risks loom large ahead of earnings.
Correction: An earlier version misstated the YoY revenue decline. Q2 2025 revenue is projected to be 11% below Q2 2024, not 17%.