U.S. markets were closed for the Independence Day holiday on Friday, with the Nasdaq and NYSE not reopening until Monday. That gives investors an extended weekend to digest Tesla's (NASDAQ:TSLA) recent stock movements and prepare for a crucial earnings report later this month.
In the last regular session before the break, Tesla shares closed at $393.45, a decline of 7.5% from the previous close. However, the stock still ended the week up approximately 3.6% from the prior Friday's close of $379.71, according to data from Investing.com.
The focus for Tesla watchers has shifted from raw delivery numbers to the underlying profitability of those sales. The company reported a significant shift in its inventory position between the first and second quarters. In Q1, production outpaced deliveries by 50,363 vehicles. In Q2, the situation reversed dramatically, with deliveries exceeding production by 28,368 units. This represents a swing of 78,731 vehicles, a figure that exceeds the 74,102-unit beat against Tesla's own consensus delivery estimate of 406,024.
This inventory drawdown raises a key question for investors: were the strong deliveries driven by genuine end-customer demand, or did they come from clearing out existing stock, potentially at lower margins? Tesla itself cautioned that quarterly delivery and storage deployment figures should not be viewed in isolation, noting that net income and cash flow are influenced by factors such as average selling price, cost of sales, and foreign exchange effects.
The delivery beat was entirely concentrated in the Model 3 and Model Y lineup, which saw 467,762 deliveries against a consensus of 392,625, a beat of over 75,000 units. In contrast, the "other models" category—which includes the Model S, Model X, and Cybertruck—missed estimates, with 12,364 deliveries versus a consensus of 12,978. Energy storage deployments also fell slightly short, coming in at 13.5 GWh against a consensus of 13.8 GWh.
Analysts are weighing in on the implications. Seth Goldstein, a senior equity analyst at Morningstar, identified Europe as a "key driver" for Tesla and said it would be "hard to see a decline" for the full year following these numbers. Morningstar raised its fair value estimate for Tesla to $450 from $425, though Goldstein advised investors to "wait for a larger margin of safety" before buying. Sam Fiorani, Vice President at AutoForecast Solutions, noted that Tesla's pricing and product mix are helping consumers look past concerns about CEO Elon Musk.
The broader market presented a mixed picture on Thursday. The Nasdaq Composite fell 0.80% to 25,832.67, while the S&P 500 closed nearly flat at 7,483.24. The Dow Jones Industrial Average bucked the trend, rising 1.14% to 52,900.07. Tesla's decline came despite the delivery beat, highlighting the market's focus on margins.
Looking ahead, autonomy is becoming an increasingly important narrative for Tesla. The company announced Friday that its robotaxi service is now live in Miami, following an unsupervised debut in Austin, Texas, in June. Plans for Dallas and Houston are also underway. Competitors such as Waymo, a subsidiary of Alphabet Inc. (NASDAQ:GOOGL), and Zoox, owned by Amazon.com, Inc. (NASDAQ:AMZN), are also expanding their robotaxi operations.
Tesla is scheduled to report its full second-quarter results after the market close on July 22. Management will host a webcast at 5:30 p.m. Eastern time. All eyes will be on the margin data to see if the delivery beat came at the expense of profitability. The 78,731-unit inventory swing makes this earnings report a critical test for the stock.
