TLDR
- Wolfe Research projects Tesla’s robotaxi revenue could reach $250 billion by 2035, assuming 30% autonomous vehicle market penetration and 50% Tesla market share
- Tesla plans to more than double capital spending to over $20 billion in 2026, including expansion of robotaxi service to seven new US markets
- Analyst remains cautious on near-term fundamentals, setting 2026 and 2027 earnings estimates below consensus due to margin pressure and AI investment costs
- Tesla stock has dropped 15% from its late 2025 peak of $498.83, trading around $402 as of Wednesday
- Wolfe expects robotaxi gross losses of $500 million in 2026 as fleet expands from 250 to 7,200 vehicles, with breakeven forecasted by 2027
Tesla shares have taken a beating lately, down 15% from their peak. But one analyst sees a massive opportunity ahead despite near-term headwinds.
Wolfe Research analyst Emmanuel Rosner maintains a Peerperform rating on the stock. He calls 2026 a “catalyst-rich year” for Tesla investors.
The firm’s top-down robotaxi model paints an eye-popping picture. Revenue from the autonomous ride-hailing service could hit $250 billion by 2035.
That projection assumes 30% autonomous vehicle penetration in the ride-hailing market. It also banks on Tesla grabbing 50% market share with pricing at $1 per mile.
If those numbers pan out, Wolfe estimates the robotaxi business alone could support roughly $2.75 trillion in equity value. That translates to about $900 billion when discounted back to today, or more than $250 per share.
Tesla CEO Elon Musk has made even bolder claims about pricing. He said last month the Cybercab robotaxi could cost riders less than $0.20 per mile by 2030.
The company is ramping up aggressively. Tesla plans to expand its unsupervised robotaxi service to seven new markets in the first half of 2026.
Those locations include Dallas, Houston, Phoenix, Miami, Orlando, Tampa, and Las Vegas. The service first launched in Austin last June.
Tesla is backing this expansion with serious money. The company announced plans to more than double capital spending to over $20 billion in 2026.
That includes a $2 billion investment in xAI, Musk’s AI-focused company. SpaceX acquired xAI on Monday, leading some analysts to wonder if Tesla might be next.
Near-Term Challenges Loom
But Rosner isn’t all sunshine about the near future. He sits below consensus earnings expectations for both 2026 and 2027.
Wolfe cut its earnings per share estimates to $1.60 for 2026 and $2.17 for 2027. That’s down from previous forecasts of $1.85 and $2.37.
The Street consensus stands at $1.99 and $2.63 for those years. For 2028, Wolfe projects $2.51 per share.
The analyst flags margin pressure from higher input costs and pricing dynamics. Changes to Tesla’s FSD monetization model also pose risks.
AI initiatives will weigh on earnings in 2026. The company faces expansion costs as it scales up robotaxis and Optimus production.
Wolfe expects robotaxi-related gross losses of about $500 million next year. That’s as Tesla grows its fleet from roughly 250 vehicles at the end of 2025 to around 7,200.
The firm forecasts gross breakeven within 2027. Potential revenues could reach around $30 billion by 2030.
Production Ramps and Market Reality
Optimus production doesn’t begin until late 2026. Rosner expects a difficult ramp with no meaningful revenue until late 2027 or beyond.
The energy storage business shows more immediate promise. Wolfe projects sharp deployment increases as new capacity comes online, though margins face pressure from competition and tariffs.
Tesla reported fourth-quarter results that beat analyst expectations. Adjusted earnings per share came in at $0.50 versus the $0.44 consensus.
Revenue hit $24.9 billion, topping the $24.5 billion estimate. But GAAP diluted EPS dropped 47% to $1.08.
Two weeks ago, Barclays analyst Dan Levy warned against excessive optimism about robotaxis. He highlighted concerns about the service’s ability to scale.
Tesla VP of AI Software Ashok Elluswamy clarified the rollout includes “a few unsupervised vehicles mixed in with the broader robotaxi fleet with safety monitors.”
Last week, Musk said Tesla already has “cars operating with no one in them and no safety monitor and no follow car” in Austin. The stock was trading nearly 5% lower at $402 on Wednesday’s session.
