Tesla shares drop 3% as investors await AI updates

Tesla shares fell more than 3% to $393.56 on Monday as investors awaited updates on the company’s artificial intelligence efforts, including its robotaxi rollout and the Optimus humanoid, ahead of second-quarter results on July 22.

The broader market softened after President Donald Trump announced a reinstated blockade on Iranian shipping through the Strait of Hormuz, writing on Truth Social: “We are reinstating the THE IRANIAN BLOCKADE, so named because it is only stopping Iran’s ships or customers from entering or leaving.” The S&P 500 fell 0.4%, the Nasdaq Composite lost 1% and the Dow Jones Industrial Average dropped 132 points, or 0.3%.

Tesla launched its robotaxi service in Austin, Texas, in June 2025 and has since expanded to several cities. The fleet remains substantially smaller than Alphabet’s Waymo.

Commercial sales of the Optimus humanoid have not begun. Tesla is preparing factory capacity while continuing vehicle output. In January the company said it would end production of the Model S and Model X to repurpose manufacturing space. Tesla posted a video showing removal of tooling and infrastructure at its Fremont, California, plant and reported the process took less than 50 days, allowing the facility to ready space for Optimus while continuing Model 3 and Model Y production. CEO Elon Musk has described humanoid robots as “a multi-trillion-dollar opportunity.”

Tesla reported second-quarter deliveries of 480,126 vehicles, including 467,800 Model 3 and Model Y units, above a consensus estimate of roughly 410,000. Jefferies raised its price target to $400 from $375 and kept a Hold rating, citing stronger-than-expected deliveries. The firm increased its Q2 earnings-before-interest-and-taxes estimate to $1.45 billion, implying a 5.1% margin, and raised its automotive revenue forecast to $21 billion, which it expects to include $250 million in zero-emission vehicle credits and $500 million in leasing revenue. Jefferies projected total group revenue of $28.7 billion and group EBIT of $1.45 billion for the quarter.

RBC Capital Markets raised its target to $500 from $475, adding a premium tied to a potential SpaceX transaction while updating its standalone valuation. RBC outlined a scenario in which SpaceX would acquire Tesla in an all-stock deal at a 20% to 30% premium and described potential operational synergies such as in-house chip manufacturing, Megapack energy systems for data centers and combined AI training and fleet management. The firm said shareholders would likely demand a premium because Elon Musk would control a larger stake in a combined company. Excluding any SpaceX-related premium, RBC’s standalone valuation for Tesla was $435 per share. RBC also increased its robotaxi segment valuation by 20% and cited a $4.2 trillion total addressable market for that business.

Investors will look to Tesla’s July 22 earnings report for details on the latest Optimus version, the pace of robotaxi expansion and how the company plans to balance new product lines with ongoing vehicle production.