11:28 AM EDT, 07/22/2025 (MT Newswires) -- Tesla (TSLA) is at a "positive crossroads" with CEO Elon Musk's renewed focus, early gains in the autonomous Robotaxi, and a coming shift toward AI leadership, Wedbush said in a note Tuesday.

Wedbush said the focus has shifted since last quarter, with Musk now acting more like a "wartime CEO" and pushing forward Robotaxi operations, especially in Austin, Texas.

Analysts are also looking for details on Tesla's AI progress, including a potential investment in xAI that may go to a shareholder vote later this year, according to the note.

Tesla's broader AI efforts, including the Optimus robot project, position the company as a future leader in robotics, Wedbush analysts noted.

The investment firm said the autonomous driving initiative alone could be worth $1 trillion to Tesla's long-term valuation.

Tesla's China business showed signs of recovery in June, with sales rising for the first time in eight months, helped by a refreshed Model Y, according to Wedbush.

Wall Street is expecting Tesla to report Q2 revenue of $22 billion, with $16 billion from automotive sales and EPS of $0.39; gross margins ex-credits are expected to be about 13% to 14%, Wedbush noted.

The recent loss of US EV tax credits will likely pressure Tesla's future cash flow, while delivery growth is expected to pick up in H2, mainly from China, the investment firm said.

Wedbush reiterated its outperform rating for Tesla with a $500 price target.

Tesla is scheduled to report Q2 earnings on Wednesday after the closing bell.

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