TSLA

Tesla stock's amazing rally, from $350 to $470 at its peak in less than one month, now stalls ahead of the company's Q3 2025 earnings report, which is scheduled for the late night of October 22nd. Those investors who are still betting on further rise of the hyping EV maker are hoping that Tesla would fly again beyond its former $25 billion milestone for quarterly revenue, which Tesla had successfully surpassed in 2024 and held for a while, then sliding into remarkable sales decline, to $19.34 billion during the first three months of 2025 which partially improved only to $22.5 billion from April to June, as well as persisting payback compression from $1.19 per share according in its record January 2023 figures to just $0.12 and $0.40 within the first two quarters of the current year. This compression effect mostly happened due to discount promotion policy amid tough competition with Chinese rivals in Europe and Asia.

This troubled time seems to have been overcome, as Tesla has finally announced the launch of its long-promised affordable electric vehicle models. However, Tesla bulls were slightly disturbed this Tuesday because both versions of best-selling cars, namely Model Y compact crossover and its Model 3 sedan seem to have too high starting prices of $39,990 and $36,990. This makes it a bit harder job to attract a new class of buyers to the brand. In fact, Elon Musk, warned many months ago that the very chance of creating a mass-market electric car for $25,000, which he promised for years, should be forgotten forever due to irreversible inflationary consequences after the money printing by central banks after the COVID-19 and geopolitical tensions preventing cheaper productions and deliveries. However, the public was probably aiming for around $35,000 per unit. Now the price has obviously advanced higher. New cars drop some premium finishes and features, but they cost only about $5,000 less than the next-level trims. Yet, they still offer driving ranges above 300 miles before recharging.

Tesla chose to build lower-priced versions of its current models. Now some experts believe that the cheaper EV cars may cannibalize sales growth of existing vehicles while others call this a kind of pricing lever instead of being a product catalyst. Many have doubts in appearing large-scaled new demand, also citing profit margin squeezing in the whole segment in the US because of upcoming $7,500 tax credits incentives system elimination. But Tesla could win against its rivals as no other automaker has such a big network of battery stations, AI-based robotaxis innovations and robotics sales contribution. Tesla is now much more than just an electric car maker. Regardless, the stock price continued its moderate correction path on the announcement of details about affordable models, falling from over $450 before the news to a retest of $425 the following day.

Tesla traded at nearly $433 in the pre-market trading this Friday, October 10, but investment minds' confusion is looming. While we have no fundamental doubts that Tesla has an ultimate capacity of hitting price targets well above $500 within the next 6-9 months, but widespread and fast wave of profit-taking with a retest of levels like $375 to $395 could easily be the crowd's initial response if Tesla team's financial projections for 2026 prove inconclusive on earnings day. Tesla price swings could continue in the days to come even before October 22. The indicated lower price range looks technically justified.