Tesla (TSLA) Stock Climbs as Its Biggest Battery Maker Crushes Estimates

TLDR

• Tesla (TSLA) stock rose 1.2% to $403.25 on Tuesday after battery supplier CATL beat Q4 earnings expectations.
• CATL reported net income of $3.3B vs. the $2.8B Wall Street estimate, on sales of $20.3B.
• CATL’s battery capacity hit 772 gigawatt-hours in 2025, up 14% year-over-year.
• CATL management forecast demand growth of 20–30% between 2026 and 2030.
• Tesla stock remains down 11% year-to-date, though still up 79% over the past 12 months.

Tesla (TSLA) stock climbed 1.2% to $403.25 in early Tuesday trading, lifted by a strong earnings report from its key battery supplier, Contemporary Amperex Technology Co. Ltd., known as CATL.

Tesla, Inc., TSLA

CATL, the world’s largest lithium-ion battery maker, reported Q4 net income of $3.3 billion on sales of $20.3 billion. Wall Street had expected $2.8 billion in profit and $18.8 billion in revenue. Both numbers came in ahead of estimates.

CATL stock jumped 9.3% in overseas trading following the results.

The beat matters for Tesla because CATL is one of its primary battery suppliers. Strong numbers from the supplier signal continued demand in the EV supply chain, which feeds directly into Tesla’s core business.

Battery capacity at CATL reached 772 gigawatt-hours in 2025, up 14% year-over-year, according to Citi analyst Jack Shang. The company also has 321 gigawatt-hours of new capacity currently under construction.

CATL’s management forecast that demand could grow between 20% and 30% from 2026 through 2030. That kind of outlook is a positive signal for both the EV market and utility-scale battery storage.

Tesla operates in both of those areas. Its energy storage business has been a growing revenue contributor alongside its vehicle segment.

Tesla Clawing Back Recent Losses

Tuesday’s move is partly a bounce. Tesla stock had slipped roughly 1% since tensions flared in Iran, which pushed oil prices higher and rattled global growth expectations.

Coming into Tuesday, TSLA was down 11% year-to-date. That’s a rough start to 2026, though the stock is still up about 79% over the past 12 months.

Investors appear to be in wait-and-see mode. The robo-taxi rollout is a key focus. Tesla launched its service in Austin, Texas in June 2025 and has plans to expand to nine cities by mid-2026.

Valuation Remains a Sticking Point

Tesla’s fundamentals tell a mixed story. In 2025, 73% of its $94.8 billion in revenue came from EV sales — a segment facing more competition and softer demand than a few years ago.

The $7,500 U.S. EV tax credit expired last year, removing a key sales incentive. Tesla has also discontinued the Model S and Model X.

Despite all that, the stock trades at a price-to-earnings ratio of 377. That number reflects investor hopes around autonomous driving and Optimus robots, not the current state of the EV business.

Tesla has not flawlessly executed in the past, and variables like regulation, consumer perception, and raw material availability all remain outside the company’s control.

For now, the stock is trading at $398.82 as of the latest print, with a 52-week range of $214.25 to $498.83 and a market cap of $1.5 trillion.

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