Tesla shares dropped nearly 6% on Monday, hitting $227.50 and hovering just above their lowest point this year, as investor anxiety mounted ahead of the company’s first-quarter earnings report. The sharp decline, the 12th such drop of over 5% this year, reflects growing concern about brand damage tied to CEO Elon Musk’s political involvement and leadership distractions.
Analysts cite “ongoing brand erosion” as a key factor dragging down the stock, which is now down 44% year-to-date. The decline comes after Tesla reported decreased delivery numbers earlier this month, with 336,681 vehicles delivered in Q1—a 13% drop from a year earlier.
In addition, CEO Elon Musk’s close ties to the Trump administration add to investor unease. Musk, who spent $290 million supporting Trump’s return to the White House, is spearheading efforts to downsize the federal government. His political activities have triggered backlash, including protests, boycotts, and targeted vandalism of Tesla property across parts of the U.S. and Europe.
Investors are increasingly expressing concern about Tesla’s slow progress in key innovation areas. Hundreds of questions focus on self-driving technology, the humanoid Optimus robot project, and Musk’s influence in politics, submitted by users on the company’s online forum for earnings-related inquiries. Some investors have asked what actions the board has taken to mitigate reputational harm tied to Musk’s political visibility.
Furthermore, analysts expect Tesla to report Q1 revenue of $21.24 billion—a slight year-over-year decline—with earnings per share projected at 40 cents. Wall Street is particularly focused on the potential impact of Trump’s tariff agenda, which could hurt Tesla’s pricing and margins, especially in China.
Consumer sentiment has also deteriorated. Research firm Caliber reported that in March, only 27% of U.S. consumers said they would consider buying a Tesla, down from 46% in early 2022.
However, Barclays, which maintained a sell-equivalent rating last week, lowered its price target on Tesla to $275 from $325, citing weak fundamentals and a “confusing set-up” for the quarter. The firm said any positive momentum would depend on Musk’s focus and updates around Tesla’s Full Self-Driving (FSD) initiative.
Tesla has teased a “live company update” alongside its earnings—a departure from its typical disclosures—raising expectations for major announcements or strategy shifts.
