Tesla’s first trading day of 2026 was anything but dull. As markets opened in New York on January 2, the electric vehicle giant’s shares initially rose in premarket trading—up about 2%—before slipping to finish the day roughly 1% lower. The catalyst? Tesla’s much-anticipated fourth-quarter delivery numbers, which fell short of Wall Street’s expectations and signaled ongoing challenges for the pioneering automaker.
According to figures released by Tesla, the company delivered 418,227 vehicles in the October–December 2025 period. That’s a significant drop: down 15.6% from the 495,570 vehicles handed over in the same quarter a year earlier. Production also slipped, with 434,358 vehicles rolling off the lines—5.5% fewer than the previous year, and notably below Bloomberg’s consensus estimate of 470,780. Of those deliveries, 406,585 were the bread-and-butter Model 3 and Model Y, while the remaining 11,642 were made up of the Model S, Model X, and the much-hyped Cybertruck.
This delivery miss wasn’t exactly a surprise. As Reuters reported, Wall Street had been bracing for a weak quarter, with consensus estimates from Visible Alpha and FactSet ranging from 422,850 to 440,907 vehicles. The shortfall was widely attributed to a rush of buyers in the third quarter, eager to lock in purchases before the U.S. federal EV consumer tax credit expired in September 2025. That policy shift, analysts say, pulled demand forward and left the fourth quarter looking thin by comparison.
Still, the numbers stung. Deliveries were down 16% from the same period in 2024, marking the second consecutive year of annual declines for Tesla. For all of 2025, the company reported 1,636,129 deliveries—a figure that keeps the spotlight squarely on demand, especially as competition heats up both at home and abroad.
China’s BYD, for example, sold a remarkable 2.26 million battery-electric vehicles in 2025. That’s enough to position the Chinese automaker to overtake Tesla in annual EV sales, as noted by Reuters. Meanwhile, in Europe, Tesla’s December registrations—a common proxy for sales—plummeted 66% in France and 71% in Sweden, though Norway bucked the trend with an 89% jump. Even so, Tesla’s market share in the region slipped to just 1.7% through November, despite battery-electric cars as a whole gaining ground.
The market’s reaction was telling. Tesla shares, which had climbed more than 46% since the summer of 2025, were volatile throughout the day. The stock hovered around the $450 mark—a round number that traders often watch for momentum signals—before closing lower. Broader U.S. equity markets also opened in the red, with the S&P 500 and Nasdaq-100 down about 0.7% to 0.8% as investors braced for key economic data on jobs and inflation in the coming weeks.
But here’s the twist: Despite the delivery disappointment, investor sentiment around Tesla remains surprisingly upbeat. As Barron’s and Yahoo Finance both highlighted, much of the optimism stems from the company’s ambitious push into artificial intelligence, automation, and the tantalizing prospect of robotaxis. Analyst Dan Ives of Wedbush Securities went so far as to name Tesla a top AI stock for 2026, predicting in a note that “Tesla will own approximately 70% of the global autonomous market over the next decade as no other company in the world can match the scale and scope of Tesla coupled with its broadening AI footprint.”
That’s a bold claim, but it captures the mood among many investors. As Truist analyst William Stein put it, “We assert investors should be more focused on AI projects, especially FSD (Full Self-Driving). We view AI developments as far more important than auto deliveries for TSLA’s long-term cash generation and stock performance.” Stein did, however, lower his near-term earnings estimates and trimmed his price target to $439, maintaining a Hold rating on the stock.
It’s not just analysts who are looking ahead. Tesla itself flagged a record quarterly deployment of 14.2 gigawatt-hours in its energy storage business—an area that’s quickly becoming a key pillar of growth. The company is set to report its fourth-quarter earnings on January 28, and investors will be watching closely for updates on automotive gross margins, pricing strategies, and any hints about stabilization in 2026 delivery trends. There’s also keen interest in whether Tesla’s fast-growing energy business can keep scaling and if management will signal any changes in spending on newer initiatives like autonomous driving and robotics.
Meanwhile, the competitive landscape is shifting rapidly. Tesla’s rivals in the electric vehicle space, including Rivian and Lucid, saw modest gains in early trading, while legacy automakers Ford and General Motors traded lower. The broader tech and AI sector also enjoyed a lift, with giants like Nvidia, Meta Platforms, and Apple posting gains on the first trading day of the year. This suggests that investor enthusiasm for innovation—particularly in AI—remains robust, even as traditional metrics like sales and deliveries take a back seat.
Yet, not everyone is convinced that Tesla’s future is assured. The company faces persistent headwinds in Europe, where registrations have declined in key markets, and the expiration of U.S. tax credits has left a noticeable dent in domestic demand. The pressure is on for Tesla to demonstrate that its investments in AI, automation, and energy can offset slowing growth in its core auto business.
As Matthew Maley, chief market strategist at Miller Tabak, told Reuters, “The market is looking for direction.” With pivotal U.S. jobs data due on January 9 and a consumer price index update on January 13, investors are searching for clues about the broader economic outlook and the potential for interest-rate cuts—factors that could influence both consumer demand and stock market sentiment in the months ahead.
For now, all eyes are on Tesla’s January 28 earnings call. Will management reassure investors about margins and growth? Will the energy business and AI initiatives deliver on their promise? And will Tesla’s bold bets on autonomy and innovation be enough to keep it ahead of a surging pack of competitors?
One thing’s for sure: in the fast-evolving world of electric vehicles and artificial intelligence, the only constant is change. Tesla’s latest results may have disappointed on the surface, but the company’s future—like its stock price—remains a story in motion.
