Hey there, Readers!
Just a quick thought to share: being the pioneer doesn’t guarantee you’ll stay on top.
Take Kodak as a perfect example—they came up with digital cameras but clung stubbornly to their film business and, well, we all know how that ended. Today, Sony Group Co. (SONY) jumped in and pretty much pushed Kodak out of the game.
Or look at MySpace; it was all the rage before Facebook came along, courtesy of Meta Platform Inc. (META), with a cleaner, snappier platform and basically rewrote the rules of social networking.
Now, let’s focus on Tesla Inc. (TSLA), which was the game-changer in the electric vehicle world. Love him or hate him, Elon Musk made EVs super cool. But right now, Tesla is in a tight spot, and it’s dealing with some serious challenges that go beyond the usual corporate hiccups.
The recent Q2 earnings report shows that Tesla’s throne is wobbling.
Musk is starting to realize how this chaotic business landscape works—disruptions happen on the fly, competition is brutal, and yesterday’s leaders can fall from grace almost overnight.
In this Smart Money piece, let’s dig into Tesla’s earnings this past quarter, and I’ll point out where things went off the rails for the company.
Plus, I’ll share about another company that’s nipping at Tesla’s heels.
Ready? Let’s get into it!
The Tesla X Factor: Missed Opportunities
Things haven’t been smooth sailing for Tesla since Musk began backing President Trump’s comeback around a year ago.
The headlines say it all…
Like back in March, when CBS News reported, “Elon Musk says his DOGE role is hurting Tesla’s stock price, calling it ‘a very expensive job.'” Or how NPR shared in April that, “As Tesla profits plunge 71%, Musk says he’ll devote less time to DOGE.” By late May, he wrapped up his stint with the Department of Government Efficiency (DOGE) after 130 chaotic days.
While political antics might seem interesting, they pale in comparison to the real issues hitting Tesla hard.
Shares dropped 8% after they announced they didn’t meet expectations for Q2 of 2025. Earnings per share slumped to $0.40, a drop of 30% year-over-year from $0.52, and revenues fell 12% down to $22.5 billion from $25.5 billion compared to last year’s quarter.
Much of this decline is due to fewer vehicle sales. Tesla reported a 13.5% fall in global vehicle deliveries during Q2, which is rough.
Meanwhile, they are being outplayed globally by Chinese competitors like BYD Co. Ltd. (BYDDF), who are selling more affordable EVs in larger quantities.
BYD is outpacing Tesla, having sold over 416,000 EVs worldwide in the first quarter compared to Tesla’s 336,000 in the same time period—all while their cars go for just north of $10,000, which is a fraction of Tesla’s cheapest model.
On top of all that, Musk’s hope for salvation through Tesla’s Optimus humanoid robots isn’t panning out; they haven’t sealed any visible deals with major companies looking to purchase these robots yet.
And just yesterday, The Information reported that Tesla isn’t hitting the marks to meet their goal of producing at least 5,000 Optimus robots this year—we’re talking merely a few hundred made so far!
This seems familiar and confirms my suspicion: I’ve had Tesla on my “Sell” list for a while.
Back in 2016, after the excitement of announcing the Model 3 and tons of pre-orders, I kicked Tesla from my portfolio and instead invested in Teck Resources Ltd. (TECK), a Canadian mining firm.
In just 10 months, while Tesla saw a 9% drop, Teck skyrocketed by a staggering 745%.
And you guessed it: I’m making the same recommendation again—Tesla just isn’t a good hold right now.
This time, I’m not focusing on the opposite end of the spectrum…
Instead, I’m pointing out a direct rival to Optimus…
Meet the Real Competitor to Tesla
I’ve pinpointed a robotics firm that’s beating Tesla to the punch by using AI software to operate specialized robots designed for warehouses and distribution campaigns.
The robots made by this company are crafted for specific duties within the warehouse, maximizing speed and accuracy while handling goods. These machines can move five times faster than Optimus and carry several hundred additional pounds.
Basically, while Tesla struggles to build the robots of tomorrow, this company is already cashing in on robots in motion right now.
Their funds have exploded 15 times, soaring from $100 million in 2019 to over $1.5 billion today, with another $23 billion poised for future sales already accounted for in the backlog.
Get the name of this winning company—absolutely free—right now.
All the details are in my latest Sell This, Buy That presentation.
Moreover, in this free special event, you’ll also learn how to access my new report, Sell This, Buy That: The $24 Trillion Rise of Robotics, highlighting three more companies set to benefit from this booming $24-trillion robotics sector.
Wave goodbye to Optimus.
Bottom line? You don’t need to be locked into stocks like Tesla, even if they’ve got glamorous names. I’m sharing what could be solid investments that might prop up your finances over the next few months.
Click here to catch my special broadcast now!
Cheers,
Eric Fry
Editor, Smart Money
The article Why I’m Saying Sell Tesla — and Buy This Robot Stock Instead first appeared on InvestorPlace.
