01:06 PM EST, 01/23/2025 (MT Newswires) -- Tesla (TSLA) will likely temper vehicle sales growth expectations for this year and put more emphasis on the potential of its physical artificial intelligence technology, Oppenheimer said in a note to clients on Thursday.

The brokerage lowered its fourth-quarter revenue estimate to $27.5 billion from $28.4 billion and its adjusted earnings per share estimate to $0.81 from $0.83. Analysts surveyed by FactSet are modeling revenue and adjusted EPS of $27.08 billion and $0.76, respectively.

Earlier this month, Tesla reported fourth-quarter deliveries of 495,570 vehicles, which was up year over year but below the FactSet-polled consensus at the time.

For 2024, Oppenheimer decreased its top-line forecast to $99.5 billion. The consensus on FactSet is for full-year revenue of $99.56 billion.

A group of the brokerage's analysts, including Colin Rusch, said their reduced expectations reflect moderating demand in the US and European Union.

"We anticipate (Tesla) to continue focusing resources and its narrative on Physical AI technology leadership while further moderating vehicle sales growth expectations in 2025 under the guise of preparation for Model 2 and autonomous vehicle introduction," the analysts wrote. Among Tesla's AI technologies are a humanoid robot called Optimus.

Oppenheimer's projections for 2025 were chopped to $111.6 billion for revenue from a prior $123.6 billion estimate and to $3.08 for adjusted EPS from $3.51. The FactSet consensus indicates revenue of $116.47 billion and adjusted EPS of $3.29 in the ongoing year.

Oppenheimer said it now models unit growth of 9% in 2025 and 12% in 2026 with potential for downside if Model 2 takes share from low-end Model 3 configurations.

"We remain cautious on (Tesla's) underlying fundamentals and relative autonomous technology position," the analysts said.

Tesla's stock has added $150 since the US presidential election. However, the analysts said Chief Executive Elon Musk's relationship with President Donald Trump could potentially complicate expectations that Tesla will be a beneficiary in the Trump administration. Musk was a key campaigner for Trump.

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