Next Tuesday, another moment for Tesla to test its loyal fans?

As the stock price continues to "plummet", the market expects Tesla to boost market confidence next week despite the first-quarter results falling short of expectations.

On April 8th, Barclays analyst Dan Levy released a report stating that Tesla's cancellation of the mass-market Model 2 project in favor of focusing on developing robotaxis could lead to a divergence in investor confidence.

In addition, various signs are also alerting investors: according to media reports, Tesla has recently cut global staff by over 10%, reduced the FSD subscription monthly fee by 50%, temporarily halted deliveries of the latest product Cybertruck and reportedly encountered accelerator pedal blockage issues.

Combined with the weakening effect of the "price war" on boosting sales and the slowing market demand, Tesla's stock price has fallen by over 37% since the beginning of this year.

Public information shows that Tesla will release its first-quarter financial report for 2024 ending on March 31st on April 23rd (next Tuesday) Beijing time.

Expected to see negative free cash flow for the first time in four years in the first quarter

The launch of the Model 2 was originally seen as a key step for Tesla to further expand its market share in electric vehicles, expected to be delivered as early as next year. The sudden strategic adjustment has heightened investors' anxiety.

Barclays pointed out that after the cancellation of the Model 2 plan, investors can only hope for a series of binary bets (including artificial intelligence, energy storage, and autonomous driving technology), which are clearly full of uncertainties. The report stated:

"It is hard for us to imagine a company of Tesla's scale betting its future on such binary bets, something no company has done before."

Some Twitter users expressed similar concerns, stating, "Elon has bet the entire company on self-development!" Musk responded to this by saying:

"It's not really betting the entire company, but I did choose to go all-in on autonomous driving."

Levy predicts that the first quarter report will show that Tesla will have its first negative free cash flow since the first quarter of 2020, and the gross profit margin after deducting regulatory credits may drop to 14.6%, a decrease of 2.6 percentage points from the previous quarter - this means Tesla's car profitability will return to the level shortly after the launch of the Model 3 in 2017.

In terms of deliveries, the report predicts that Tesla's deliveries in 2024 will remain flat, mainly due to the inventory backlog issue that Tesla is still facing: there were about 100,000 unsold cars at the beginning of the year, and an additional 45,000 to 50,000 units of inventory were added in the first quarter.

However, some analysts believe that despite facing significant challenges, Tesla's "meme stock" status and Musk's personal influence may still provide some market support for the company. The market reaction to the company's long-term strategy and short-term performance will be the focus of attention in the financial report.

The report also found that based on Tesla's historical stock price performance, in the week of releasing financial reports or delivery data, the stock on average drops by 7%, while during periods without official news, the stock on average rises by 1% each week. This may indicate that even if Tesla's stock price falls next week due to disappointing financial results, it may gradually recover or rebound thereafter