Tesla shares drop after EV sales fall short of expectations

• Tesla sales for the first three months of 2026 came in below Wall Street's expectations, as demand for EVs slowed.
• Elon Musk's automaker sold 358,023 EVs in the first quarter, up 6% from the same period last year.
• It comes as Tesla prepares to ramp up production of its Cybercab robotaxi and Optimus robot.

Tesla is facing a make-or-break year. It's kicking it off with a sales miss.

Elon Musk's automaker said on Thursday it sold 358,023 EVs in the first three months of 2026, up 6% from the same period the previous year but below Wall Street's expectations, as it continues its ambitious pivot to robotaxis and humanoid robots.

Tesla's share price fell by over 4% premarket on the delivery figures. Analysts expected the EV giant to deliver 372,160 vehicles, according to a Bloomberg consensus. A separate analyst consensus compiled by Tesla projected the company would sell 365,645 EVs.

The sales jump is largely down to the fact that Q1 2025 was the automaker's worst quarter since 2022, with Tesla's factories disrupted by the rollout of the updated Model Y and the backlash to Musk's cost-cutting role at DOGE hitting its peak.

The year-over-year rise is Tesla's first since the final quarter of 2024 — with the exception of Q3 2025, when customers rushed to snap up EVs before the end of the $7,500 tax credit for new electric vehicles in September.

Like the rest of the industry, Tesla has been hit hard by slowing demand for electric vehicles since then.

The EV winter has seen overall automaker sales plunge by 28% so far this year in the US, according to Cox Automotive figures, and the likes of Ford, Stellantis, and Honda have all canceled electric models and scaled back their EV investments.

The cooldown saw Tesla report a nearly 16% fall in sales in the final quarter of 2025 and record its second consecutive annual sales decline, with Chinese rival BYD taking the Cybertruck maker's crown as the world's largest seller of battery-electric vehicles.

Wedbush Securities analyst and Tesla bull Dan Ives called the latest delivery numbers "underwhelming" but unsurprising in a research note on Thursday.

"This was not a shock to us given the current EV backdrop across geographies while the company shifts gears to focus more on its AI strategy," Ives said.

A Tesla-compiled consensus of analyst projections predicts sales will grow slightly this year, but estimates they will remain well below the record 1.81 million deliveries Tesla achieved in 2023.

That is unlikely to concern Musk too much. The billionaire has made it clear that Tesla's future lies in autonomous robotaxis and its Optimus humanoid robot.

In January, Musk told investors Tesla would discontinue its pioneering Model X and S EVs and use the factory space to build Optimus.

Tesla is also set to begin production on its dedicated Cybercab robotaxi, which doesn't have a steering wheel or pedals, in April, and is partnering with fellow Musk company SpaceX to build an enormous "Terafab" that will supply its robots and robotaxis with dedicated chips.

The company's robotaxi rollout has lagged rival Waymo, however, with Tesla yet to expand its fully autonomous ride-hailing service beyond Austin.

Despite Musk's declaration that Tesla is done with being a traditional automaker, conventional EV sales still account for the majority of the company's revenue and will be critical to funding Tesla's expensive robotaxi and robotics ambitions.

Tesla told investors in January that it would raise capex spending from $8.5 billion to $20 billion this year to fund construction of six new factories, including Cybercab and Optimus production lines.

That figure doesn't include spending on Terafab, which analysts have described as a "Herculean" feat that could cost over $50 billion.