Tesla‘s (NASDAQ: TSLA) stock remains a battleground between bulls and bears, and the latter appear to be winning so far this year. It’s a pivotal year for the company, setting the direction for the next few years.
No one is buying Tesla stock solely for its electric vehicle (EV) or energy businesses, because the valuation (Tesla trades at 161 times the analyst consensus for 2026 earnings) is high. Instead, investors are pricing in a substantial increase in earnings from its robotaxi and, later, the Optimus robot business, as well as ongoing earnings from EVs and energy.
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However, the key near-term catalyst is the robotaxi business, not least because, in theory, it will bring a recurring stream of fast-growing income from commissions on every mile driven in a robotaxi, as well as software revenue from full self-driving subscriptions and charging revenue.
The development of the robotaxi is behind the dramatic earnings increase that Wall Street analysts are penciling in for Tesla in the coming years. The chart below shows the mean earnings-per-share (EPS) estimate and the massive difference between the low and high estimates. Let’s put it this way: The high estimate in 2030 is almost 3 times the low figure, so assuming both analysts pencil in the same valuation multiple, then one target will be arguably 3 times the other.
The massive growth in mean estimated earnings (a compound annual growth rate of 47% to 2030) clearly prices in robotaxi revenue growth.
But here’s the thing. Tesla’s robotaxi business isn’t scaling as fast as anyone would hope, and certainly not as fast as CEO Elon Musk’s public announcements suggest.
It’s not just rhetoric; Tesla is making multibillion-dollar investments to develop a robotaxi business, including starting volume production of its dedicated robotaxi vehicle, the Cybercab, in April, and building a lithium iron phosphate (LFP) battery factory in Nevada, partly to provide batteries for the Cybercab.
Musk said at the 2025 annual shareholders meeting that “the rate at which we receive regulatory approval will roughly match the rate of Cybercab production,” but with Cybercab production set to ramp up imminently, and Tesla so far failing to expand its unsupervised robotaxi network beyond a few cars in a limited area of Austin, Tesla is at risk of tying up capital and cash unnecessarily.
