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As post-Tesla earnings break down (NASDAQ:TSLA) continue to come, Deepwater Asset Management's Gene Munster and Brian Barker outlined a key reason why Tesla (TSLA) may have signaled a “notable” slowdown in unit volume growth this year. He Analysts said the Osborne effect could be at play.
The Osborne effect is roughly defined as a social phenomenon in which customers cancel or postpone orders for current products due to the official or unofficial announcement about a future product that may compare favorably. The Osborne effect is considered a form of sales cannibalization by a company when setting its product strategy.
Munster said that since Tesla (TSLA) revealed that a new cheaper vehicle ($25,000 to $30,000) is on the horizon, it made sense for management to lower its 2024 growth outlook in anticipation of the possible Osborne effect. based on Model 3 demand. Notably, TSLA's outlook also did not include many details on gross margin, Opex, or CapEx expectations. While Munster believes Tesla's (TSLA) growth story will take off again in the second half of 2025, he warned that the near term could see some disappointing delivery numbers for the EV giant and a slow price reaction. actions in the dark phase.
“Coming into the quarterly report, consensus expectations were for 19% growth this year, in line with last year. After a day of analyst revisions, the Street now expects about 13% revenue growth gross in 2024. My feeling is growth this year will end at 10%, which suggests there is still some downside to current estimates; as the first quarter progresses, those estimates will come down and by mid-year growth rates of the sales model will be of the appropriate size.
As things stand now, the consensus expectation is for Tesla (TSLA) to generate revenue of $110.5 billion and earnings per share of $3.26 in 2024. The consensus mark for 2025 is revenue of $137.8 billion of dollars and an earnings per share of 4.54 dollars.
Looking further ahead, Munster believes Tesla's (TSLA) growth rate will be close to 30% in 2026 and margin rates will once again exceed 20%. Those estimates suggest that Tesla (TSLA) would be in a dominant position on the earnings front.
