Elon Musk’s Tesla posted one of its weakest sales quarters in years to start 2026, as the onetime Wall Street darling struggles to turn around its business.
The automaker delivered 358,023 vehicles during the first quarter, according to a company release on Thursday. The number came in well below the expectations of analysts, who projected quarterly deliveries of 372,160 on average, according to Bloomberg.
The figure actually marked an increase of 6.3% compared to the same quarter one year ago, at the height of the backlash against Musk for his controversial work with President Trump and the Department of Government Efficiency. Excluding that quarter, Tesla’s first-quarter delivery figures were its worst since mid-2022.
The company’s stock sank more than 4% in Thursday trading after the announcement and was down more than 16% since the start of the year. Tesla has recorded two straight years of annual sales declines.
Wedbush analyst Dan Ives called the numbers an “underwhelming start” to the year for Tesla, which is in the midst of a turnaround effort centered on Musk’s bold proclamations about artificial intelligence and robotics.
“While the delivery numbers were quite underwhelming, 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 wrote in a note to clients.
Musk has touted AI-enabled products, including driverless Cybercabs and Optimus humanoid robots, as the key to Tesla’s long-term growth.
Ives said Tesla’s budding robo-taxi business “remains the golden goose in unlocking TSLA’s AI valuation.”
Meanwhile, Tesla has struggled to entice buyers with its aging vehicle lineup and has faced increased competition from Chinese electric car makers like BYD in Europe and Asia. For now, car sales still comprise the vast majority of Tesla’s revenue.
Wall Street will be watching closely when Tesla next reports earnings, on April 22.
