So heres my take on whats been going on with Tesla stock — its been a rough ride, and honestly, it’s gone from bad to worse over the past few months. Back at the start of 2025, I thought the company was just going through a bit of a dip, but now it’s pretty clear that things are unraveling faster than expected.

It started with Tesla’s Q1 2025 earnings. Revenue was down 9% year-over-year, and even worse, automotive revenue dropped 20%. That’s not a small decline — it’s a full-on slump. Net income crashed by more than 70%, and margins took a huge hit. Their operating margin fell to just 2.1%, which is shockingly low for a company that used to be proud of its efficiency.

Then came the delivery numbers. Tesla delivered around 337,000 vehicles in Q1, which was way below expectations and down 13% compared to the year before. Sales tanked in key international markets — Europe was down almost 50%, China nearly 49%, and Australia by a brutal 76%. Even though Tesla still dominates in the U.S. with over 40% market share in EVs, the global slowdown is a major problem.

What’s worse is this doesn’t seem to be a temporary thing. It looks like there’s actual demand erosion happening. Tesla’s been slashing prices left and right and even throwing in incentives like free FSD transfers and 0% financing — which honestly just makes the whole thing feel desperate.

And while Tesla was struggling, competitors like BYD in China and other EV makers started gaining traction. Tesla’s once unbeatable lead in innovation and branding seems to be slipping fast. Their margins are shrinking because they have to keep cutting prices to compete, and that’s just not sustainable.