Companies

Shares of TSLA declined by 4% in after-hours trading as investors wanted to hear more from the company about expected progress this quarter for Robotaxi in Austin. While the disappointment is understandable, it doesn't change the fact that Tesla is still best positioned to capitalize on autonomy and physical AI long term. As for deliveries, they should quicken in mid 2026 as the new, more affordable model begins to aggressively ramp.

Elon’s success at changing the TSLA investment narrative to autonomy has shifted the focus topics for June earnings. Investors will zero in on five topics on the call: 1. Commentary about expansion of the robotaxi service 2. Timing of the new more affordable vehicle or Cybercab 3. Impact of the tax credit sunset on deliveries 4. The typical focus on auto gross margins ex credits. 5. Timing of Hardware 5. I continue to be positive on TSLA given they remain best positioned in physical AI.

On April 24, Google reported March earnings and delivered a clear message: AI is augmenting Search, bringing in new queries and improving relevancy rather than cannibalizing it. On May 7, Eddie Cue testified that Search usage inside Safari had declined for the first time. Then on May 20, at Google I/O, the company announced AI Mode, its most aggressive response yet to ChatGPT. I expect Google's June results will reflect a steady state in Search, which should be a near-term positive for shares of GOOG. Management’s commentary on early AI Mode engagement and monetization will be crucial. I expect the message to echo the March call, aiming to reassure investors that they have a plan. My take is that while the while their AI strategy may protect user engagement, it will ultimately prove negative for monetization.

Shares of NVDA are up 4% on the news that it will resume sales of the H20 in China, but this move understates the true impact. I believe this development will add 10% to the Street’s revenue estimates over the next four quarters. For CY26, analysts were previously expecting 25% growth. Following the announcement, consensus for those analyst that have updated their models now calls for 30% growth. I believe CY26 will ultimately see growth of 35% or more. The bigger takeaway: China's demand for the H20 highlights that the AI investment cycle is still in its early innings, with a long runway ahead.

For years, EV buyers fixated on range as the key buying metric in response to range anxiety. As Tesla enters the autonomous era, a new metric is taking center stage: the strength of the car’s self driving hardware. A Tesla’s processor and sensor suite (HW3 vs HW4 vs upcoming HW5) now determine how well it can run FSD software and whether it can access future autonomy upgrades. I believe HW5 will be needed for the fleet to go mainstream, and upgrading existing hardware will be cost prohibitive. The bottom line: Tesla is best positioned to be one of the biggest winners in autonomy, despite the reality that rolling out new hardware will be a near term governor on growth.

Jeff Williams’ retirement marks the end of an era for Apple’s operational leadership, given that he has been with the company for 27 years, 10 of those as COO. Given the recent challenges with AI, some might interpret the news as evidence that Apple’s leadership is struggling. However, I believe this is a well-orchestrated changing of the guard. New COO Sabih Khan, who joined Apple in 1995, and likely future CEO John Ternus, who joined in 2001, reflect continuity and deep institutional knowledge. Steve Jobs wrote the book on leadership transition, one that Tim Cook continues to implement with precision.

In June, U.S. EV sales were down 6%, compared to up 9% in March 2025. I believe we will return to growth next year because EV headwinds around tax credits, buyer options, charging infrastructure, and range anxiety are temporary. By 2030, I expect 25% of new car sales in the U.S. will be EVs, up from 8% today. The timeline to mass electrification has stretched, but the economic incentives are still in place for them to eventually account for all vehicle sales. Once mainstream buyers internalize that an EV can cost half as much to “fuel” and meaningfully less to maintain, adoption should accelerate, especially as charging infrastructure scales and compelling sub-$40k options proliferate.

JB Straubel’s Redwood Materials has launched a new business line, Redwood Energy, which repurposes old EV batteries into low-cost (roughly 50% savings over new Lithium), fast-deployed (2x faster, could be years faster in some cases) energy storage systems for data centers. At an event at its Nevada campus last week, Redwood showcased a microgrid built from about 800 retired EV battery packs powering a 2k GPU data center operated by Crusoe. While the company’s recycling business continues to grow, I believe the Energy business will be the real growth driver going forward. Bottom line: credit JB for spotting a major opportunity. They’ve taken Redwood Energy from concept to first deployment in under a year, with a compelling value prop on both cost and speed. The next hurdle is getting big tech providers comfortable with the idea that used batteries can be just as reliable as new ones.

June deliveries came in 4% above whisper expectations and in line with the published consensus. Most investors, including myself, were expecting around 370,000 units, down 17% y/y. Instead, Tesla reported 384,122, a 14% decline. The good news: that -14% should mark the bottom (March 2025 was -13%), with growth rates improving going forward. More importantly, if deliveries hold steady over the next couple of years and the company makes measurable progress on Robotaxi and FSD, the stock should respond positively.

The prevailing narrative around Apple’s AI efforts is that the company may not be moving fast enough to meet its goal of launching a new Siri by next spring. However, Mark Gurman’s recent report suggests Apple is determined to deliver by considering hitting the reset button on Siri by partnering with companies like OpenAI or Anthropic, or potentially acquiring Perplexity. This more aggressive approach is encouraging for AAPL investors, as it signals the company understands what’s at stake and is willing to think outside the box to get there.

All that matters for Apple’s AI is this next version of Siri, which we should see by June of next year. We know the current Siri is well behind ChatGPT and wanted to quantify that gap. We tested the two and left with a new perspective: Siri isn’t an AI assistant. It is still just a voice-activated search tool. The combo of Siri and ChatGPT improved the quality of the results, but it took on average 5 to 10 seconds, underscoring one challenge of leveraging a third party LLM.

Tesla will report June deliveries the morning of July 2nd. We expect deliveries of 370k, down 17% y/y, compared to FactSet consensus calling for down 12%, and down 13% last quarter. The June quarter should mark the low point of the delivery declines, and we expect the back half of the year will show improvement, albeit still declining. We expect investors will take two things away from the June deliveries: 1) June was an ugly number and that's ok because the worst should be behind us. 2) Despite the delivery declines, the company has ample cash to continue to invest in new vehicles and autonomy. We expect the overall cash and investments position to end the year between $33–35B, compared to $37B at the end of March. That said; all that matters for shares of TSLA over the next six months is the pace of the Robotaxi rollout.