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The pace of Tesla Inc.’s sales decline is expected to slow, offering investors a measure of relief amid a lengthy downturn at Elon Musk’s electric car maker.

The company likely delivered around 439,600 vehicles worldwide in the three months that ended in September, according to analysts’ estimates compiled by Bloomberg. Although that would amount to a roughly 5% drop from a year ago — and mark Tesla’s third straight quarterly decrease — it would be an improvement relative to the first half of 2025, when vehicle sales tumbled 13%.

Tesla has sought to steady its core business that’s struggling with an aging lineup, the elimination of U.S. policies supporting the EV market and consumer backlash to Musk’s politics. The CEO has distanced himself from President Donald Trump’s administration recently even as he has remained vocal on divisive issues.

The delivery results will be “pivotal for Tesla moving forward,” said Andrew Rocco, stock strategist at Zacks Investment Research. “This quarter, they have a chance to at least show that that legacy business has stabilized.”

Tesla has largely diverted attention away from the sales weakness by emphasizing its recently launched driverless-taxi service and artificial intelligence and robotics development efforts. The company is also seeking shareholder support for an unprecedented new compensation package for Musk potentially worth $1 trillion if he can hit growth objectives.

Wall Street has largely bought in, with several analysts raising their stock-price targets and delivery expectations in recent days. Tesla shares soared 33% in September, recouping early-year losses with their best monthly performance of 2025.

EV sales in the U.S. got a temporary boost in the third quarter from the end of a federal $7,500 consumer tax credit, after buyers flocked to showrooms ahead of the Sept. 30 deadline.

Tesla has “likely seen strong gains from this summer’s rush to buy EVs” in the U.S., Cox Automotive Senior Economist Charlie Chesbrough said on a conference call with reporters. Still, the third quarter could be a “mixed story” overall for the company, he said, predicting that Tesla will lose more market share in the final months of the year.

Musk has already warned of “a few rough quarters” for the carmaker due to changing EV policies in the U.S. In addition to the expiration of the tax credit, the Trump administration has moved to unwind fuel economy and emissions requirements, choking off regulatory credit revenue that buoyed Tesla for years.

The headwinds are compounding challenges in several key markets. In China, shipments from Tesla’s Shanghai factory dropped in seven of the first eight months of the year amid increasing competition from local rivals like BYD Co. and Xiaomi Corp. Tesla recently started deliveries of a six-seat Model Y in the market to try to regain momentum.

In Europe, Tesla’s sales have continued to erode, dropping 22% in August. The company’s new-vehicle registrations slumped 33% in the first eight months of the year, even as the broader EV market grew 27%, according to the European Automobile Manufacturers’ Association.

Garrett Nelson, an analyst with CFRA who in mid-September lowered his rating on Tesla’s stock to sell from hold, warned of a drop in the company’s fourth-quarter sales even as he predicted the third-quarter numbers could be better than expected.

“Tesla and all other EV manufacturers have done everything possible to maximize their sales for the current quarter,” he said. The delivery total “could be deceiving” because the margins may be slim if incentives and pricing adjustments were used to stimulate demand.

“There are still going to be a lot more questions than normal following this deliveries report,” Nelson said.