Tesla, the electric vehicle (EV) heavyweight, is set to report its Q1 earnings after the bell on Tuesday, offering investors a crucial update on the company's performance and future prospects. This announcement is highly anticipated as Tesla's stock has endured a significant decline of 43% year-to-date, resulting in a seven-day losing streak.

The first quarter of 2024 has been an eventful rollercoaster ride for Tesla. Following disappointing Q4 results and weak delivery guidance for the year, investor sentiment took a hit. The company also missed Q1 delivery estimates, adding to concerns about global demand for Tesla vehicles.

According to Bloomberg consensus estimates, analysts project adjusted earnings per share of $0.52 for Tesla in Q1, accompanied by top-line revenue of $22.31 billion. If these figures hold true, it would mark the company's first revenue decline in four years. Furthermore, operating profit is expected to slide by 40% compared to the previous year, totaling $1.49 billion.

Weaker-than-expected sales contributed to this decline, as Tesla reported 386,810 global deliveries in Q1, falling short of estimates by around 62,000 vehicles. In terms of production, Tesla manufactured 433,371 vehicles, slightly below estimates of 452,976. The disparity between vehicles produced and sold has raised concerns about waning demand and has forced the company to implement multiple price cuts.

Investors will closely scrutinize Tesla's future product roadmap during the earnings report. Of particular interest is the long-awaited next-generation platform that was supposed to underpin a sub-$30,000 mainstream EV, known as the Model 2. This vehicle was expected to be a game-changer, leveraging a revolutionary "unboxed" production line to minimize costs.

However, doubts arose after Reuters reported that Tesla was cancelling the plans for the cheaper EV. Tesla CEO Elon Musk responded, denying Reuters' claim but leaving the fate of the Model 2 uncertain. Musk later took to social media to announce the unveiling of a robotaxi, which lacks a traditional steering wheel and pedals. This shift towards robotaxis instead of a low-cost EV raises concerns among analysts due to associated risks.

Deutsche Bank's Emmanuel Rosner highlighted that the Model 2's cancellation would relinquish one of the key reasons why many investors hold Tesla stock. This model was expected to yield a surge in volume, margins, and free cash flow. Furthermore, it would rely on Tesla successfully cracking the code for self-driving technology, which comes with significant regulatory hurdles and the need for substantial data.

However, Bank of America's John Murphy remains optimistic, noting that Tesla's management suggested the Model 2 was still under development and may be introduced in the second half of 2025 due to a slower production process caused by new technology.

In addition to these crucial updates, Tesla may also address other significant aspects of their business during the post-earnings conference call. This includes the status of recently announced staff cuts of over 10% and management's stance on upcoming shareholder votes scheduled for June. These votes pertain to a change in Tesla's state of incorporation and the approval of Elon Musk's controversial 2018 pay package, which was previously voided by a Delaware court.

Tesla's Q1 earnings report will undoubtedly shed light on the company's current financial health, demand outlook, and future plans. Investors, stakeholders, and enthusiasts alike eagerly await the update, hoping for positive signs amidst a tumultuous stock performance and uncertainties about Tesla's strategic direction.