Tesla Skyrockets on Robotaxi Dreams Despite Grim Q2 Earnings — Is TSLA Becoming the Next AI Powerhouse?
Tesla (NASDAQ: TSLA) closed near $305 today, falling 8.2% after reporting a weak Q2, yet traders continue to swarm in. The stock, listed on the NASDAQ, is down about 24% year-to-date and sits approximately 37% below its all-time high.
Even with earnings per share sliding to roughly $0.40—marking a 23% decline—and revenue dropping 12% to $22.5 billion, the market’s attention has shifted away from fundamentals. Pressures on margins, evaporating U.S. EV tax credits, and fierce international competition haven't stopped traders from piling in.
Instead, TSLA is experiencing a wave of short squeezes that are forcing bearish traders to buy back shares, igniting upward momentum. Behind this optimism is Elon Musk’s vision of Tesla evolving into an AI and robotics company, with autonomous robotaxis and humanoid robots like Optimus leading the narrative.
Robotaxis Ignite a New Bull Narrative
Tesla’s pilot robotaxi service launched in Austin on June 22, 2025, using modified Model Y vehicles monitored by safety drivers. Riders pay a flat $4.20 per trip, confined to low-speed roads and favorable weather zones.
While early performance includes missteps like wrong-lane entries and phantom braking—leading to scrutiny from the U.S. National Highway Traffic Safety Administration—Tesla continues to push forward. Elon Musk has already announced aggressive expansion plans into California, Nevada, Arizona, and Florida, targeting coverage of half the U.S. population by the end of 2025.
Wall Street remains split. Analysts from firms like UBS, CFRA, Cantor Fitzgerald, and Wedbush recognize the futuristic appeal but caution that regulatory approval, technological readiness, and realistic timelines remain major hurdles.
Retail Traders Pour In, Eyeing the $400s and Beyond
Social platforms like Stocktwits are flooded with TSLA chatter. Despite recent earnings disappointments, many retail traders remain bullish, posting aggressive price targets above $400.
Much of this hype revolves around the potential of Tesla to evolve far beyond just a car company. Musk’s vision is one where autonomous vehicles and robotics define the brand’s future—both of which could unlock massive new revenue streams.
This optimism continues to dominate discussions even as financial results fall short. Q2 results disappointed, but investors are pricing in a future defined by robotaxis, full self-driving, and the upcoming production of the Optimus robot.
Competition Is Real, but So Is the Hype
Tesla faces stiff competition from Alphabet’s Waymo, which is already logging over 250,000 robotaxi rides weekly across five U.S. cities. Unlike Tesla, Waymo has years of regulatory groundwork and real-world data on its side.
Analysts warn that profitability may remain elusive until Tesla can reduce the robotaxi unit cost to below $100,000. Nonetheless, Tesla is investing heavily in this future, with production of Optimus expected to begin in 2026. Starting that year, Tesla plans to allow individual vehicle owners to list their EVs on the Tesla Network, enabling them to earn income as part of the robotaxi fleet.
The Critical Milestones to Watch Next
The coming weeks will be pivotal. Key developments include regulatory approvals in California and Florida, broader rollout beyond Austin—especially a planned Bay Area launch this weekend—and early performance metrics from robotaxi rides.
Investors are also watching closely for updates on FSD pricing models and timelines for Optimus production.
Tesla’s stock is soaring not because of what it just reported, but because of what some believe it will become. If robotaxi and AI milestones are hit, TSLA could usher in a new era of growth. But if those promises fall short, the downside may be steep.
For now, the street is betting that the robots are real—and the future is closer than we think.