Tesla's shares experienced a decrease to initiate the New Year.
Tesla's shares experienced a decrease to initiate the New Year.
The shares of Tesla (TSLA decreasing by 6.95%) had an impressive surge to wrap up 2024. However, 2025 is off to a disappointing start, not solely due to profit-taking. Tesla revealed its fourth-quarter and full-year electric vehicle (EV) delivery figures today, and investors showed little enthusiasm.
For the first time, the company recorded a decrease in the year-over-year number of EVs it dispatched to customers. This news led to a drop of up to 7.5% in shares on Thursday morning. As of 11:15 a.m. ET today, the stock was still trading lower by 5.8%. This halted the late 2024 rally that resulted in a return of over 62% the previous year.
Looking Beyond Tesla's EVs
Management reported 495,570 EV deliveries in the fourth quarter. Although this was a quarterly record, it fell short of the anticipated 505,000 deliveries. This also meant that Tesla shipped slightly fewer vehicles in 2024 compared to 2023. Full-year deliveries were approximately 1.79 million, compared to 1.81 million in the previous year.
However, investors need to consider factors beyond its EVs to comprehend the stock's valuation. Tesla's energy sector is an area of interest. After experiencing a 125% growth in energy deployments in 2023, the company's 31.4 gigawatt hours (GWh) of energy storage deployed in 2024 represented another 114% increase year over year. The demand for energy storage has risen as renewable energy production has expanded.
But many investors are eagerly awaiting the company to launch a fully autonomous vehicle that doesn't need human involvement. Elon Musk has boasted about Tesla's self-driving technology to enable a fleet of robotic taxis that could potentially generate a significant new revenue stream for the company. Its robotics division could also become a future income generator.
For now, though, the company's income and profits are derived from EV sales. With a slight decrease for the first time year over year, some investors are selling shares today after a substantial return in 2024. Long-term investors should continue to monitor how Tesla's technology continues to progress and decide if this potential is worth retaining shares.
In light of Tesla's financial report, some investors are choosing to sell their shares due to the slight decrease in year-over-year EV delivery figures, impacting the company's primary source of income. To diversify their investments and potentially secure future revenue streams, many investors are keeping a close eye on Tesla's advancements in the energy sector and self-driving technology.
As the renewable energy production expands, Tesla's energy deployments have followed suit, growing by 125% in 2023 and an additional 114% in 2024. Furthermore, the demand for energy storage has also risen, providing an opportunity for Tesla to expand its income sources beyond its electric vehicle sales.